Haute cole "Groupe ICHEC ISC ST-Saint-Louis ISFSC"

BEYOND PAPER E-books as a new way of reading and communicating?

EUROPEAN MASTER IN MULTIMEDIA AND AUDIOVISUAL BUSINESS ADMINISTRATION (E.M.M.A.B.A.) Academic year 1999-2000

"Organised in Brussels with the support of the European Unions Media II Programme and in co-operation with the University of Metz, the New University of Lisbon, the University of Athens, the University of Paris VIII, Kemi-Tornio Polytechnic, Lapland University"

Thesis by: Marta Costa Ramires Thesis supervisor: Prof. Dr. Carlos Correia October 2001 Universidade Nova de Lisboa Faculdade de Cincias Sociais e Humanas

Lisbon, Portugal

ACKNOWLEDGEMENTS

I would like to thank you all those who have supported me in the last two years, namely my thesis supervisor, Prof. Carlos Correia, my family, Joo Santos, Isabel Santos, Katarina Botik and Joo Lopes. I would also like to thank those who have made their contribution into the ellaboration of the thesis: - Prof. Lus Carmelo, Universidade Autnoma de Lisboa - Dr. Alexandre Leite, Universidade Autnoma de Lisboa - Joo Lopes, Editorial Notcias - Dr. Carlos Santiago, TexEdiNet - All the institutions that supplied information, documents, interviews and other material.

INDEX
1. Introduction 1.1. The subject 1.2. Questions 1.3. Research parameters and work method 7 1.4. Information sources A New Communicational Model 2.1.The book: a traditional model? 2.1.1. A precious asset 2.1.2. Revolution: supersession and liberation? 10 2.1.3. Architecture of knowledge and its storage 2.1.4. Technological illiteracy 2.2. Accessibility, connectivity and interactivity 2.3. Reading and formats 2.3.1. Cognitive processes of reading 2.3.2. Language and new formats 2.3.3. A new relationship reader/text 2.3.4. Physical nature of the book versus virtual nature: relationship man/object 2.4. Obstacles and advantages of the new model 2.4.1. Obstacles 2.4.2. Advantages 2.4.3. Reference, technical and academic books 26 The Market 3.1.Commercial and / or cultural asset? 3.2. Portugal 3.2.1. Internet access in Portugal 3.2.2. Digital attitude 3.2.3. Buying contents 3.2.4. Reading habits in Portugal 3.2.5. TexEdiNet, the first Portuguese distributor of e-books 3.2.6. Clix and the first Portuguese interactive e-book 3.2.7. The Portuguese National Library and the DiTed project 3.3. Europe 3.3.1. Bertelsmann 3.3.2. Vivendi Universal 3.3.3. Gallimard 3.3.4. 00h00.com 3.3.5. Cytale 3.3.6. Penguin 3.4. USA 3.4.1. Pioneer projects 3.4.1.1. Project Gutenberg 3.4.1.2. University of Virginia Library Electronic Text Centre 3.4.1.3. Stephen King, the lonely semi-commercial pioneer 3.4.2. Commercial ventures 3.4.2.1. AOL Time Warner 3.4.2.2. Viacom 3.4.2.3. Random House 3.4.2.4. Barnes & Noble 3.5. Market global tendencies New objects 4.1.E-Ink and e-paper: the future? 81 4.1.1. e Ink 4.1.2. Xerox 4.2.P.O.D. 4.2.1. The hardware suppliers 5 5 6 8 9 9 9 12 14 15 17 17 19 20 21 22 23 24 31 31 32 32 35 37 38 39 43 45 49 51 54 57 57 59 62 63 64 64 65 70 72 72 73 74 76 79 81 82 85 87 89

2.

3. 3 4

7 4.

8
9

10 11 12 13 14 15 16

4.2.1.1. Xerox 4.2.1.2. IBM 4.2.2. The virtual salemen 4.2.2.1. Lightning Source 4.2.2.2. Barnes & Noble 4.2.2.3. Xlibris 4.2.2.4. Libri 4.3.Objects, tools and services 4.3.1.Hardware 4.3.1.1. e-book containers 4.3.1.1.1. Gemstar 4.3.1.1.2. Franklin 4.3.1.2. PDAs 17 4.3.2.Software 18 4.3.2.1. Adobe Acrobat e-book Reader 19 4.3.2.2. Microsoft Reader 4.3.3. Web sites 4.3.3.1. Netlibrary 4.3.3.2. iPicturebooks 5.Conclusions Bibliography & Web Index Appendix 1 Appendix 2 Appendix 3

89 90 90 90 91 91 92 92 93 93 93 95 96 96 97 97 99 99 100 102 107 112 119 130

1. INTRODUCTION
"Le public aura besoin des mmes contenus, mais dits diffremment." Agns Touraine, CEO of Havas1 "Un livre n'est rien qu'un petit tas de feuilles sches, ou alors une grande forme en mouvement: la lecture." Jean-Paul Sartre in Situations I

1.1. The subject The creation of the e-books and of new digital ways of transmitting what we traditionally call the "printed word" will be the focus of this master thesis. Its main goal is to analyse how they can be conceived as a new communication model and to look through the most significant ongoing economical projects, focusing on the European scenario, namely the Portuguese emerging one, and, as a term of comparison, the American one. The depth of analysis of the Portuguese, European and American scenarios varies according to my knowledge of the realities that surround it, to the reliable data available at the moment of the draft of this thesis and to the highlight that I decided to give to each one. Therefore, the analysis on the Portuguese situation is more developed as it is the most familiar to me and I managed to have access to more information, namely regarding statistics, companies, institutions, projects and products. It is also the one, among the three, I chose as primary subject because, as I have just told, it is the nearest one and because it is inserted in the European scenario. The analysis of Europe's reality stands as an independent approach but it is, simultaneously, complementary to the Portuguese one. Thirdly, it was chosen an insight to America among other possible hypothesis, like the Japanese one, for example, as it is one of the countries where the development of ventures is quite prolific and they create a singular interest. It is also a good term of comparison with the European scenario. Nevertheless, the development of the approaches to the European and American ventures was conditioned by the reliable information available. The choice of the theme of the thesis was made based on four major reasons. First, it is an area of personal interest as I have been
1

TOURAINE, Agns in Livres Hebdo, n 359, 26/11/99, page 59.

working in the last six years in a Portuguese publishing house and, consequently, involved with a communicational model that has been established for centuries, the book. Secondly, from the communicational point of view, e-books can be seen as the visible face of a potential new communication model. Thirdly, it is a multimedia related area that has been evolving, on one side, as commercial, and therefore, profitable, projects and, on the other side and at the same time, also as academic, cultural and non-profitable projects. Fourthly, two of the markets analysed, Portugal and Europe, are very interesting scenarios to be studied. 1.2. Questions Since the appearance of the first Homo Sapiens to our days, Man has continuously created new different ways of communicating, through different languages and different means. In the last decade, with the worldwide popularisation of the Internet, from 1995 onwards, and more recently, with the upcoming of the first e-books (1998), a new communicational model seems to be emerging. This thesis does not aim to give a pragmatic answer to any question related to this area but to give a contribution to its analysis. I defined the following questions as the main guidelines for the thesis: 20 Can e-books and the new digital ways eventually surpass the concept of "printed word" and, more specifically, the book model? 21 Will they render a new communicational model? 22 Can its appearance be considered a revolution within the terms of the on-going digital revolution? 23 If so, will this revolution have a simple technological scope or a broader one, i.e. social? 24 What kind of contents will be more successful? 25 Despite the major investments from several big world editorial groups in this new market, in the last three years, the existing technology is still very far ahead of demand? 26 Are there several different regional business models, like, for instance, an European one and an American one, among others? 6

27 Will Portugal fit in any of them? 28 How may the new objects and tools affect our life? Other issues like the authors' rights problems and security problems (copyrights infringements) are not addressed in this thesis because its complexity and richness would originate by itself another separate thesis. The examples chosen for analysis, namely the companies and institutions in chapter three, are presented because I considered them the most emblematic and illustrative in the development of the epublishing activity. Many were left aside because it would be impossible to analyse all. 1.3. Research parameters and work method The work method chosen starts from a theoretical approach of the hypothetical new communication model and deepens into a more specific analysis that encloses an insight of the market and of the new realities created for it. This method seems appropriate for a thesis whose main goal is to analyse how e-books and the new media can be conceived as a new communication model and, at the same time, to look through its economical dimension. This method was the basis for the creation of a three-module development structure. The first module, "A New Communication Model" defines what is meant in the thesis by communication model and tries to give an explanation why can e-books be considered one and what advantages and disadvantages it may carry with it. The second module, "The Market", gives a contribution to the analysis of the regional economical scenario of Europe, USA and Portugal, in this area and of the ongoing global tendencies. The third module, "New objects", tries to depict the most representative new objects and tools related with the new communicational model. Steps on the research path: 1 2 3 4 5 6 Acquisition of general information; Definition of the concept of communication model; Characterisation of the new communication model; Identification of the major economical and cultural players; Analysis of players; Analysis of the geographical scenarios: Europe and United States;

7 Analysis of the Portuguese example; 8 Global perspectives of success; 9 Identification of the new objects and tools; 10 Conclusions. The difficulties found during research are due to the scarcity of specific and fully developed bibliography on the subject of the thesis. There are anthologies of papers like The Future of the Book or Page to Screen, among others, but not fully developed works (if we may call it so). The existence of only one project of e-book production in Portugal also sets an obstacle for a wide range and comparative solid analysis. 1.4. Information sources As mentioned before, there is not much specific bibliography available. There are conference papers bound in several anthologies and more general bibliography, like literary theory, that may be considered secondary. Much of the data was taken from magazines and newspapers articles and official press-releases from companies. Those are the most updated sources along with reports and interviews to specific players. It was also used the information collected in conferences which were also a useful source for more bibliography. The most useful source of field research for practical examples was undeniably the Internet sites.

2. A NEW COMMUNICATION MODEL 2.1. The book: a traditional model? In the on-going debate about how the digital revolution, namely the e-book, will or will not put aside books, one of the most common sentences that comes out is that the book is, and has always been, a privileged object and a traditional model. Is this assumption as old as we think it to be? Books will or will not be superseded or its text liberated through digital models? If there will be a change it will be just a technological one or will it have a broad social scope that will lead to vital changes in the architecture of thought, books and libraries? Is this revolution already in progress? Like the book, the so called traditional model, text digital formats, be it an e-book or anything else, will also go through what Mankind fought for in the last century: the universal right for literacy, despite one's race, religious beliefs, social status, etc? Will this century's fight be the one against technological illiteracy? These are the questions to be explored around the status of the book as a model, traditional or not. 2.1.1. A precious asset Since the Middle Ages that books, at the time codices, have been considered a precious and protected asset. However, the introduction of the printed word by Gutenberg began its democratisation process and, in fact, books have never been the exclusive, or even the most prevalent form of printed matter. By the time Enlightment and the French Revolution sprang up in Europe, book was still seen as a cultural form that encouraged slow, reasoned reflection upon events. Newspapers and pamphlets made possible, at the time, more spontaneous, rapid, and effective interventions. More, nowadays the book is seen by some, as Carla Hesse puts it, as " a slow form of exchange. It is a mode of temporality which conceives of public communication not as action, but rather as reflection upon action. Indeed, the book form serves precisely to defer action, to widen the temporal gap between thought and deed, to create a space for reflection and debate."2 But it is also undeniable that it is one of the most widespread objects that carries out the human thought across the world. However, massification does not mean preciousness or high status and along with
HESSE, Carla, "Books in Time" in The Future of the Book, Berkeley and Los Angeles, University of California Press, 1996, page 27.
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the book as a mean of transport for the human thought, there are several other means to carry it, like cinema, music, television, etc that have enshortened the time that mediates action and reflection, and the path between author/creator and reader/public. The idea that the book has been for long a privileged object and a traditional model is old but it is questionable whether it truly corresponds to reality. It is a built-up idea that has prevailed for long and has turned the book into a sacred object, the carrier and perpetuator of the written word. Nevertheless, it still rules the world of reading. 2.1.2. Revolution: supersession and liberation ? Nowadays, all the most modern models of communication have not overcome the book. It still exists and will continue to exist. In fact, the notion of supersession, the idea that each new technological type vanquishes or subsumes its predecessors rebirths every time there's a menace of a new revolution. It tends to show the sense that culturally the past has been left behind. The new thing that is coming up does not only replace the old one, but it will supersede it. Ex. Marinetti's "Manifeste du Futurisme". Supersession is, nevertheless, a quite simplistic approach of evolution. Only by denying it will we be able to understand the true complexities and consequences of any revolution. What happens is what in evolution is commonly known as destructive creativity, i.e., when something new appears it crashes and threatens what already exists and, consequently, causes instability. However, as soon that new element fits in among the already existing elements, stability is recovered and life goes on. As we have seen, in the history of human communication, radio wasn't replaced by television, nor did newspapers disappeared, or cinema was set apart by the video. They all co-exist and converge to an ultimate goal - communication -, but in a wide range of options giving Man the opportunity to choose the more adequate or preferred form. Another idea expressed especially by those who advocate the new technologies of information is liberation. I.e. the pursuit of new information technologies is simultaneously a righteous pursuit of liberty: "information wants to be free" and that technology is going to free it. In this case, free the writing form from the page in order to liberate and democratise the text. As Paul Duguid argues, through the thought of R. Lanham, the "electronic text will disempower the force of linear print" and "blow wide open" social limits imposed by the codex book, in the process democratising the arts and allowing us "to create that genuine social self." The desire for a technology to liberate information from

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technology is not far from the search for a weapon to end all weapons or the war to end all wars. ()"3 To use Duguid's example, "we cannot think of wine in bottles, each of which has a separate identity. We have to think of information and technology as mutually constitutive and ultimately indissoluble. () In the end all information technologies and the information they carry whether made from trees and cows or sand and petroleum - are not independent, but interdependent. () then, as a machine, the book is clearly more than a conduit for ideas produced elsewhere. It is itself a means of production. () Books produce and are reciprocally produced by the system as a whole."4 So, if we are not dealing with a content and container situation, it does not make any sense to speak in liberation of the text. Nevertheless, a revolution is already in progress. The coming of ebooks and the transformation of contents displayed in paper into the digital format may not have been yet revolutionary steps of change. Ebooks and texts in computer screens still do not offer a comfortable reading nor do they allow a successful absorption and understanding of what we read. More, up to this moment, they do not offer any extra value over the paper characteristics. However, they present some new features, like the portable storage of many books inside a small device and the mobility capacity, that are revolutionary and that possibly will lead to the construction of a new communication model. One device that might fit in this idea and lead to this new model is being developed simultaneously by e Ink and by Xerox in the United States. It is called e-paper and I will speak about it in chapter 4.1. Epaper gathers the characteristics (see chapter 2.3) of paper that allow a comfortable reading and a successful selection, understanding and memorisation of what we read and the ability to change the text content of a single page in seconds, from any part of the globe (through an Internet connection) and eventually, one day, to store the content of several books in it or screen a film. This might be the true revolution in reading and publishing that still has not happened but that might be on its way. It would mean a new turn over in the history of communication. However, the revolution that is happening is not simply technological, it is mainly an act of socialisation as "the advent of
DUGUID, Paul, "Material Matters: the Past and Futurology of the Book" in The Future of the Book, Berkeley and Los Angeles, University of California Press, 1996, pp. 75-76.
3

DUGUID, Paul, "Material Matters: the Past and Futurology of the Book" in The Future of the Book, Berkeley and Los Angeles, University of California Press, 1996, pp. 78-9.
4

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multiple new technologies is probably changing not only particular works, but also the social system in relation to which the works were written and read. It will take care and thought to negotiate these changes, and the task will inevitably become more difficult if changes are made in material processes without regard to the social pratices they underwrite."5 Example of it are today's processes of social demassification and individualisation (as a consequence of the material demassification - dematerialization). For instance, huge mainframe computers have progressively become individual laptop computers that allow people to work separately, alone, without any need to communicate (anti-social consequence) and not to share common artifacts. Carla Hesse defends the idea that cultural institutions such as the book "were not consequences of printing, but rather of socio-political choices, embodied in legal and institutional policies that ensured the realisation of that cultural ideal. () I do not think that technologies are the only, or even the main issue at the centre of the debate. () What we must determine, then, in the remaking of the literary system in the electronic age () is what kind of cultural agents we envision for the future. () The introduction of these new technologies has radically destabilised and transformed the legal, economic, political, and institutional infrastructure of modern knowledge exchange - permitting, most significantly, the circumvention of traditional mechanical pathways of publication and communication. But these cultural consequences have less to do with the design of the microchip than with the forms of knowledge and modes of exchange that the introduction of microchip technologies has both wittingly and unwittingly made possible."6 2.1.3. Architecture of knowledge and its storage The social revolution ahead may irrevocably change not only our idea of the literary system/book but also the architecture of thought and its storage. A recent example of it is the conception of the new Bibliothque Nationale de France and the international project to create libraries for the new parliamentary bodies emerging in Eastern Europe. The first project is based on a despatialisation of the library's form, an architecture of the void that goes along with a new
DUGUID, Paul, "Material Matters: the Past and Futurology of the Book" in The Future of the Book, Berkeley and Los Angeles, University of California Press, 1996, page 83.
5

HESSE, Carla, "Books in Time" in The Future of the Book, Los Angeles, University of California Press, Berkeley and 1996, pp. 28-29.
6

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conceptualisation of storage, if we are allowed to call it so, of knowledge. There is no archive of knowledge but circulation; the classificatory grids are replaced by intersection: the bodies or corpus of knowledge give place to modes of thought, apprehension and expression so that information flows between its creators and its users. There is no storage, because knowledge is no longer that which is contained in space, but that which passes through it, like a series of vectors, each having direction and duration yet without precise location or limit. According to librarian Robert Berring, with the Boolean search through vast full-text databases there is no need for indexers and fixed indexes of texts, or subject catalogues. Each individual user can construct a unique search path through any database. Shortly, fixed canons of texts and fixed epistemological boundaries between disciplines will no longer exist. One can have interdisciplinary paths of research. The notions of the writer and the reader are also under change. The designers of the workstations for the Bibliothque Nationale de France, for example, redefine the reader in terms of the kind of reading he pratices. The social (learned versus popular), political (public versus private), or economic (fee paying versus non-fee paying) categories that once described the constituencies of literary life will disappear. The imagined writer-readers in the electronic age are conceived, instead, in terms of their mode of action in time. The true difference will be between long- and short-term researchers that will have its own sense of direction, because they will be competent in the technologies of research, even though they will not know where they will end up. We leave the world of space, and plunge into the dimension of time, but to live in a continuously immediate present. The second project, the international project to create libraries for the new parliamentary bodies emerging in eastern Europe, consists of a series of globally coordinated satellite networks linking far-flung databases that are not really located anywhere at all except in the hands of their users.

2.1.4. Technological illiteracy The formation of new readers/users for this type of libraries and e-books, and for the Internet in general, take us to another issue which is not new, only presents a new variant. The XX century saw the birth of

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the fight to reduce alphabetic illiteracy. With the upcoming of the digital revolution, the new century ahead will have to deal with the digital illiteracy. E-mail communication, the on-line public forum, certain forms of interactive hypertext, Internet navigation may seem, today, common and easy-handled everyday tasks. However, the age, social, economical, religious differences that make us different one from one another alienate what should be the universal right for the new literacy. Roger Chartier, former president of the scientific council of Bibliothque Nationale de France, said in the 26th Congress of the International Association of Publishing Houses that the 3rd revolution on books is on its way. The first one took place when the papyrus roll was replaced by the codex, the second came with the invention of the printer and the third one come along with the creation of the electronic book, through the Internet or through reading devices, like the Rocket eBook. However, even if we considered e-books a true revolutionary step in the history of reading, are people prepared and willing to deal with machines involved? I think that there is too much optimism around it. Text digital formats, be it an e-book or anything else, will have go through the fight for a new universal right for literacy and that will certainly be one of the next century's fight. I asked in the introduction of this thesis whether e-books and the new digital ways can eventually surpass the concept of "printed word" and, more specifically, the book model. At this moment, as things are set, I think that it is quite unlikely and if the path to follow is e-paper it will only reinforce and develop the concepts of "printed word" and book. Up to now, only e-paper seems to be the closest artifact to become part of a new communicational model. However, as I pointed out earlier, artifacts (technology) are but a part of a true revolution. They will have to be able to act upon Man's and society's mentality and customs and people will have to be prepared and willing to be acted upon.

2.2. Accessibility, connectivity and interactivity Even if we do not believe that e-books may constitute a new communicational model, the digital written contents, the Internet and ebooks in particular have, at least, caused accessibility to information to be re-invented. One question should be asked. Following the Internet initial free spirit, e-books should be accessed as shareware or freeware

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software is? Several authors, like Seth Godin, defend that it should. What about copyright and the authors' revenues? Most companies that are selling e-book services offer their clients free e-book samples that are usually titles under public domain. Even those can be easily given away without having to cater for the protection of its copyright? These issues are far from being solved but they were unquestionably raised because the access to contents is no longer safely confined as it was up to now. If the commercial interests and laws were up to the upcoming of Internet the guardians of copyrights and revenues, the birth of Internet and the free diffusion in it of contents, being it texts, music or films, has launched the old existing protective structure into chaos. This is due to the fact that up to this moment there is not an effective regulator entity that can control "movement" of contents and reassure its integrity in the Internet. Another perspective of accessibility is the freedom of an author and its works to reach an audience without having to go through editors and publishers' censorship and approval. The direct access, without having to pass through the complete chain of intermediaries that mediate the author and his readers, gives the true sense to the concept of self-publishing. According to Melanie Rigney, editor of "Writers Digest" magazine, there are over 24 million creative writers in the United States, less than 5 percent of which are published. Companies such as Xlibris, iUniverse and Mightywords are wooing the other 95 percent with a vengeance. While the majority of these new companies are reputable and do offer a valuable and democratising service, Rigney says that at the end of the day this is still self-publishing. The ubiquity of contents, which can now be stored in any place of the net, gives another insight to accessibility to contents. The problems of having access to a thesis stored on a library located on the other side of the planet have ended as, if it is available in a digital version, it can be located anywhere on the net and easily accessed in minutes. The storage in digital format also allows us to keep an almost unlimited quantity of information making the concept of space obsolete in this sense. "The new technologies are the symbol of the freedom and capability to dominate space and time, like the car on the 30s. There are three main concepts to understand the success of the new technologies: autonomy, dominance and velocity."7 One of the advantages of hand-held devices that can carry within e-books is its mobility capacity that also implies accessibility. So, one of the main
7

WOLTON, Dominique, E Depois da Internet ?, Algs, Difel, 2000, page 77.

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features in the download contents from the Internet is connectivity. Nowadays, mobile phones present the WAP (Wireless Access Protocol) system, an access protocol from mobile devices that allow users to have access to news, weather and stock results services. However, it seems to have failed to conquer users as it is a quite expensive and slow service. But the revolution expected by communications companies is UMTS (Universal Mobile Telecommunications System). These companies argue that with this system, with new services and contents of text, voice and image in the small mobile devices, things will change as the access through broadband will be quicker and the mobile Internet will become of common, everyday use. More personalised services based in contents, e-commerce, video-conference, the availability of these services in PDAs and Pocket PCs and the consequent immediate satisfaction of the users' needs will attract users, it is said. However, the UMTS implantation, the core of the third generation of mobile phones, needs quite high investments, namely in infrastructures, software applications, what will make it hard for companies to get ready profits from the investments made. Those will imply more expensive devices and subscription services. Also the need of permanent production of contents is quite expensive. In particular, in Portugal, the high rate of penetration of mobile phones in Portugal is illusive as people use the mobile phone simply as an extension of the traditional phone. So, it will possibly take another try to make mobility work so well as the turning on and the functioning of a television set. Another added value that e-books and written e-contents have brought in is interactivity. The digital format of text, e-books and the Internet created a crisis in the frontier between reader and author as the pluri-dimensional nature of the new technologies promoted the confusion between reader and player that may contribute to the drafting of a text. Nowadays it is common to have web sites that encourage the participation of readers in the on-line writing of an e-book that is presented as a work-in-progress. On the other hand, opposed to the linearity of the traditional text is another kind the interactivity that e-books, one day, can present. In the present days, this is already observable in the strong appeal of youth to the new technologies, namely to computer games that present no only text but also image, sound and video and whose structure of action is similar to narration structure, story-telling, and appeals to the user participation.

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The true revolution will take place when e-book or e-paper will conquer this multimedia concept by integrating in their bodies text, image, film and sound. But, to have that it is needed that files from images, sound and movies will be light enough to be easily downloaded from the Internet and fit in small devices to constitute the so-called "personal portable digital libraries". It still does not exist but it is not far ahead. A children's dedicated web site, ipicture.com, is working on this area to create not only illustrated e-books but that also have an interactive component that may attract children to participate in games. 2.3. Reading and formats 2.3.1 Cognitive processes of reading Reading is a decoding technique as language signs are written according to a certain code and reading allows us to decode those signs. As Roland Barthes has put it, "reading means "unpacking" what was put aside: is to open a warehouse in a chosen moment, is to give life to what was reserved, made into virtual status. This technique tries to dominate time."8 In that code, one of the rules is the uni-dimensional linear order that dominates alphabetic writing by copying the movement of time linearisation and it is that what draws the word9. Besides linearity, there is also the direction in which we write a text. Most western people write from the left to the right, following, according to old beliefs, the course and movement of the second sky, the set of the seven planets and through this it pictures, through the sequence of words and its display in space, the world's own order. Western people do not write from left to the right just because we were thought like that but mainly because it is the way the brain and our visual system wants us to do it. As Derrick De Kerckhove said: "It is the internal structure of the language that determines the direction of writing. () The choice of the direction depends of the reading process. () Language is the software that leads human psychology. Any technology that affects deeply the language also affects behaviour in a physical, emotional and mental way."10 Reading frequently involves not just looking at words on a page, but also underlining, highlighting and commenting, either on the text or
BARTHES, Roland and Compagnon, Antoine, "Leitura" in Enciclopdia Einaudi, vol. 11, Lisbon, Imprensa Nacional-Casa da Moeda, 1987, page 185.
8

BARTHES, Roland and Marty, Eric, "Oral/Escrito" in Enciclopdia Einaudi, vol. 11, Lisbon, Imprensa Nacional-Casa da Moeda, 1987, page 174.
9 10

KERCKHOVE, Derrick De, A Pele da Cultura, Lisbon, Relgio d'gua, 1997, pp. 60-61.

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in a separate notebook. This combination of reading with critical thinking and learning is called active reading what allows the understanding and the memory of what is read. Pens and paper have been essential for active reading for centuries and nowadays there is no device that can supplant those materials in its importance of active reading. Desktop computers fail to support many key aspects of knowledge work, including active reading, free form ink annotation, fluid movement among document activities and physical mobility. Its interfaces, the keyboard, screen and mouse, are far from being adapted to human hands and eyes. Hand-held and pocket size devices are even less appealing to our senses as they present small screens where text has to be presented in a reduced dimension what difficults reading and, consequently, the selection, absorption and memorisation of what is read. Besides the linearity of writing and the directional writing that paper allows, we must add to these factors the physical qualities of paper. The touch and the soft reflection of light towards the eyes are characteristics that make paper one of the best materials for reading to human eyes. In fact, "the closed cover, turned page, broken spine, serial form, immutable text, revealing heft, distinctive formats, handy size, and so on offer their own deep-rooted and resilient combination of technology and social process and continue to provide unrivaled signifying matter."11 But, as we have seen, if hand-held and pocket size devices like PDAs (personal digital assistants) are not suitable for reading, at least, for long texts, e-book containers do not seem to be far behind in advantage as, even though their screens are bigger in size, texts are still displayed in shinny screens that hurt the human eye in a long-time reading. So far, the only device that seems to resemble the qualities of paper is the e-paper that is being developed by eInk and by Xerox (for more details please see chapter 4.1) that not only gathers traditional paper qualities as it adds the feature of, like a palimpsest, being rewritable. 2.3.2. Language and new formats Along with the importance of any material on the way we read, there is also the important role of the language. For centuries, humans
DUGUID, Paul, "Material Matters: the Past and Futurology of the Book" in The Future of the Book, Berkeley and Los Angeles, University of California Press, 1996, page 64.
11

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have read, as I mentioned before, in a linear order and in a certain direction that varies according to cultures. However, the creation of hypertext, that allows the connection (linkage) to other parts of a document, to other documents or even Internet connections, has broken that linearity. But, is the hypertext as we conceive it today is something truly new? Or it has been lying undercover in books for some time? Some see the footnote as a shadowy predecessor of the hypertext, as hypertext particularises a part of the text and interrupts the linear process of reading by means of an individual link that adds more information to the one displayed in the text. An illustrative example of how the hypertext works is the phenomenon of Discoveries whose voyages between the XIII and XIX centuries caused the interconnection of almost all cultures of the planet, at several different levels. With the spread of merchant capital, these links in effect produced a global network with several of the characteristics of hypertext. It was and endless, unfinished, nonsequential, transnational and highly practical web of circulating information. The hypertext enables the enrichment of the text with extra information. But, at what cost? It replaces linearity of the text by random access and the narrative structure by individual blocks of meaning. This kind of language gives the sensation of never-ending information as a link can be followed by another link and so on, in an endless chain. The solution could be "tear" the paper into pieces by making links. But this will hide the text and, therefore, it is not hypertext. The image of the Advent calendar, in which the child opens one window each day and sees what is inside it, it is possibly more appropriate as it would mean to fold the text into smaller and smaller parts in order to build a paper plane that can be sent, received, easily unfolded and read without the reader loosing the sequence of the text. Nevertheless, this does not mean that the digital books of the future should remain composed by linear text only. Interactivity and multimedia should be explored over its limits as text, image and sound can unite themselves to enrich the experience of reading a book. As Nicholas Negroponte points out, "while a book may be randomly accessible and your eyes may browse quite haphazardly, it is nonetheless forever fixed by the confines of three physical dimensions. () Information space is by no means limited to three dimensions. An expression of an idea or train of thought can include a multidimensional

19

network of pointers to further elaborations or arguments, which can be invoked or ignored. The structure of the text should be imagined like a complex molecular model. Chunks of information can be reordered, sentences expanded and words given definitions on the spot. These linkages can be embedded either by the author at "publishing" time or later by readers over time. Think of hypermedia as a collection of elastic messages that can stretch and shrink in accordance with the reader's actions. Ideas can be opened and analysed at multiple levels of detail."12 However, this should be done in such a way to assure the best reading, selection, understanding and memorisation of text, images and sounds. This new order of the book should be thought in a way that the critical selection of knowledge will be an important aspect in the use of such new laws and not just as an at random mixture of text, image and sound. 2.3.3. A new relationship reader/text The digital format also gives the writers the idea of sovereignity over the writing. As Dominique Wolton puts it, "writing, e-mailing, filing, erasing without limits, effort, continuously and outside the constraints of time and space are the major advantages of the computer systems. It is true that the user is seduced as well as by the autonomy as by the performance. Each does as it pleases, whenever he wants: without God or master. Here, we face the essence of liberal ideal of the individual. The individual controls everything, being able to develop freely his capabilities, secure his destiny, cultivate, e-mailing, and create relationships without the minor constraint of any structure."13 In general, we could compare it with the idea of full development of Man set by the French Revolution and Enlightment. The easy and direct access to certain documentation services and the need to act alone ("do it yourself") and the ability for interaction that characterise the individuals of the modern society found on the Internet the appropriate place to its development. Here the limit is the competence to know what kind of information to look for and to what end as the direct access does not replace the hierarchy of knowledge and learning. The most evident symbol of such freedom is Geocities' web site, a virtual city that gathers two million of cybernauts and where they can create, cost free, their personal web pages and be read by a never-ending audience. The problem is that this audience also wants to
NEGROPONTE, Nicholas, "Books without Pages" in Being Digital, London, Coronet Books, (1995)1998, pp. 69-70.
12 13

WOLTON, Dominique, E Depois da Internet ?, Difel, Algs, 2000, page 78.

20

be heard and, in the whole, what comes out is a network with millions of individual voices that want to be heard. The Internet, that could be the home of a cultural Esperanto, where everyone communicates with each other in the same language, looks like, each day that goes by, more and more a chaotic net of cries. More than that, "we are far away of a web that favours a new utopia of society oriented to the exchange and to the opened to the other, free of powers. On the contrary, we are facing an integrated system of information whose aim is more in the economy-world than in the improvement of the inter-personal relationships."14 2.3.4. Physical nature of the book versus virtual nature: relationship man/object The new systems of information, namely the Internet, look like the hypermarkets, they are the big party of information and communication. It is an open world, accessible to all where there are never-ending books. We are facing a new Far West, an utopia where abundance, freedom, absence of control prevail and people is given the idea of auto-promotion as they learn in a school where there is no teacher. The traditional book, unlike e-books, are closed units that cannot be re-written, are confined by physical barriers and need to be redone to receive up-dates. With e-books, even though we are limited by the memory capacity of a device, it can be expandable through memory cards. E-books can easily be re-written and updated in seconds. These three characteristics of e-books and of e-paper contribute to an improvement of Man's access to information in the way that they allow him to up-date easily the information he receives, have an almost endless source of information and re-use a book. Adding to it, there is the fact that, in a near future, e-books and e-paper may include in the information displayed images and sound what will work out as an extraand complementary source of information. Regarding e-paper, it may improve the traditional paper characteristics giving Man the opportunity to remain faithful to the material that is most comfortable for him to read in, paper, and by extension, the book, and to have it improved with new features such as the ability to be re-written and, who knows, to store the content of more than one book.

14

WOLTON, Dominique, E Depois da Internet ?, Difel, Algs, 2000, page 92.

21

As we have seen, the relationship between reading and formats and materials are not simple because they imply established cognitive processes of reading that exist for centuries, as well as the relationship between reader and text and between Man and object. Devices like PC, PDAs or e-book containers and its related software are far from catering for the needs that Man has when he reads a text. It is true that these devices present some extra qualities like mobility and optimised storage of contents but these are not the essential features. The main issue continues to be the process of reading. Without it no device will conquer entirely Man's affects and choices. As I asked on the introduction to this thesis, can e-books and the new digital ways eventually surpass the concept of "printed word" and, more specifically, the book model? The answer is no, at least for now, as the devices and tolls created so far do not cater for the demands of the human process of reading and, therefore, do not present the needed characteristics to conquer the human eyes and mind. As I have repeatedly pointed out, so far, the only "device" that may, in a near future, gather the characteristics of the human reading process, paper qualities related with it and new features like mobility and optimised storage of contents is e-paper. For the other devices that I mentioned before, its interfaces will have to improve significantly. 2.4. Obstacles and Advantages of the New Model In our days, every invention has to accomplish three different factors in order to succeed. As it is something created by Man, it has to break new grounds and bring something new that did not exist before (creativity). It also should be a new step in technological evolution and it has to be popular and well accepted what, in our days, means that it has to be commercially acceptable. If, nowadays, any invention cannot gather these three conditions, it will die at birth and will never enter the history of human inventions. If e-books and e-publishing in general manage to gather the three factors, it will certainly start a new lightning age on the history of writing. However, the objects that we have today are enough to create a new model of communication or are they still far away to reach such evolutionary stage? As we have seen in the past, when we look back through the history of writing, writing has the plastic ability to adapt to the mean that carries it. It did so with animal skin, papyrus and paper.

22

No matter how revolutionary its stage can be, it faces obstacles as it presents advantages. 2.4.1. Obstacles All the objects or containers used to receive and store e-books still present ergonomic flaws. The small size of the screen still does not allow a comfortable reading as paper does and the interface itself is similar to the PC one, not attracting better a user than a PC does. To this, it can be added the clear absence of the concept of the product, what is originated by the existing diversity of formats and hardware and software platforms. This lack of solutions of interoperability will only end when the several e-publishers and other companies that work in this area join forces to create single standard formats and platforms. Another obstacle is the existing price instability regarding not only e-books but also containers. If prices do not reflect an advantage when compared with the book in paper and considering that the prices of the containers are still quite high, people will wonder why they should buy e-books instead of books made of paper. Another aspect is the discussion around copyright protection that has been keeping authors at large. This is not the place to develop this subject because it would originate another thesis. However, it is undeniable that cases like Napster have raised enough fear among authors and authors' agents to keep them aside. One of the attempts to solve the subject, encryption, can also lead to a multiplication of standards. Another attempt is the usage of an e-book to be confined to a single container. I.e. the e-book downloaded to a PC cannot be transferred to another or to any handheld device. Another obstacle is the existence of a high number of different business models. This diversity has its origin in several aspects. One is the difficulty on the definition of target-public. Is the public that traditionally buys paper books going to buy also e-books or the target that companies should seek are people used to the Internet environment. Most publishers transport to e-publishing the concept of target-public of the traditional book market by starting their e-ventures with catalogues of mass-market best-sellers. On the other hand, the easiness that e-books present in the sense that are books that do not imply physical production has originated a mixture of the roles of the publishing industry's traditional agents. Every

23

on-line bookshop is now acting as publisher for first titles. Printers are selling books on-line through the print-on-demand system without needing the help of retailers or bookshops. Publishers can sell e-books directly to customers and by this way dismiss printers and distributors. This polivalence of functions of each agent shows a major capacity of adaptation but it has also contributed to the present confusion in the publishing industry. And no one knows what will come out of it because those changes of roles are still not consistent enough to be considered new business models. Nevertheless, this change in the traditional roles of the publishing industry may open new doors. The importance of being able to manage databases and to transport the different contents through the net and other channels is an ability that was not among the traditional functions of the publisher or the bookseller. The idea on interactivity between the supplier of contents and the readers is something that did not exist before and it is now essential in this new commercial process. The book is now made as the reader wants it and he participates in the edition process. 2.4.2. Advantages On the other hand, there are characteristics of the digital world that may enrich what we today call book. The digital space presents an endless capacity of information storage. The world-size book with an endless number of pages dreamed by Mallarm, Flaubert and Goethe, among others, is nearly at anyone's hand. The digital world and the Internet allow an easier way to access information. The papyrus was folded and unfolded. The change to the codex represented a major step as the leaf through the pages of the book is even easier. Now you can access in a few seconds information stored in any place on Earth through a click in a computer mouse. The ability to update at any time, from any place of the planet and without leaving any remainder turns the e-book and any other epublication into a true palimpsest as it can be re-written. The multimedia concept that allows the memorisation of image, sound and text may lead to the dissolution of words. It also carries

24

within the idea of interactivity. The reading on the screen allows a distance that you do not have when you have a book in your hand. However, a book in your hand implies a direct contact but you do not "touch" the words, while the hypertext and its linkage system allow to interconnect almost unto the infinite. The universal access of the Internet and its ubiquity is something that the book made of paper cannot grant. This allows a delocalisation of the information whose single pieces can be stored in different places and be gathered in seconds to form a single unit to be read by a reader. To leaf through pages means a sequence of steps, but on the Net the books are not bound, it is the reader who does it. The Internet also allows assinchrony, i.e., the coincidence of the action, as several readers can read the same book at the same time and each reader can read different pages at the same time. This new kind of paper is never-ending but the screen that displays it is very small for a comfortable reading. The solution could be "tear" the paper into pieces by making links. But this will hide the text and, therefore, it is not hypertext. The image of the Advent calendar, in which the child opens one window each day and sees what is inside it, it is possibly more appropriate as it would means to fold the text into smaller and smaller parts in order to build a paper plane that can be sent, received, easily unfolded and read without the reader loosing the sequence of the text. For the writer, the Internet and e-books mean the opportunity of being read by a never-ending universe of readers and of not having to submit its work to the trial of editors and to the physical limits of distribution. It is the democratisation of publishing, it is the selfpublishing. It also allows the writer to create direct relationships with his readers and it might happen also between readers. In the publishing industry the distinction between publisher, author and bookseller is blurring. Some authors can write their books on-line and sell them directly to their readers, some publishers will sell directly to consumers. Some on-line booksellers will become publishers and distributors. And it is also the end of the "out of stock" reality. The economy of the publishing activity is deeply changed by the absence of physical stocks on e-publishing, namely through the P.O.D. (print-ondemand), as the perspective of having a small print-run is again acquainted and blurred with the idea of never-ending stocks. The coming up of e-books and of e-publishing is for the publishing industry

25

an event similar to paperback revolution that took place in the 60's, as it is a new whole perspective on publishing that will change the way of publishing, organising catalogues, choosing works to publish and on deciding how to promote them. However, will e-books render a new communicational model? I don't think so. They have clearly set the way for a change but the revolutionary element has not appeared yet. The major publishing groups are betting on the e-publishing of fiction classics and best-sellers and reference books and on the digitalisation of its catalogues. But is this a revolution or just a way of transposing a practice, publishing, into the digital "format" without anything new added? 2.4.3. Reference, technical and academic books On the beginning of this thesis I issued the question of what kind of e-book's contents will be more successful. Publishers who have started their e-book ventures are nowadays betting on works from famous, mass market, best-seller authors, and on books free of rights like classics, namely in the fiction area, where authors' names are more sound. The e-book world has seen a bit of everything, from Stephen King self-publishing a serial to Mary Higgins Clark's entire back list going electronic, passing through Seth Godin, author of the best-selling Permission Marketing, offering his online book, Unleashing the Idea Virus, for free. More, Seth Godin's experience with Unleashing the Idea Virus proved that an e-book offered for free on the Internet can lead to and raise the numbers of the sales of a traditional paper book. After 250 000 free downloads of the e-book, more than 100,000 people asked for a sample. Nowadays, Unleashing the Idea Virus is translated into 10 languages and is the # 5 on the Amazon best-seller paper book list. But, would you buy the book of the moment and read 300 or 400 pages in your PDA or PC screen just for entertainment and fun? Would you stand it? Most people still find it hard to be facing a screen while reading for fun during hours and there is not a clear advantage of reading fiction or long essays books on screen just for enjoyment if your eyes hurt or you cannot fully absorb what you are reading. Nevertheless, things might be a bit different if you are studying and researching and need to have access to different sources to write a paper to deliver. In this case, electronic texts present nowadays the

26

advantage of being able to be carried in an electronic device to any place, be reachable from any place of the planet and of having extra functions like text research, linkage, insertion of bookmarks and notes. The idea of selling chapters alone instead of the whole book also represents an advantage specially for those who are studying, namely in specific disciplines like medicine, science, management and Law, as it is a cheaper way to access information without having to spend much money in expensive books. Last August, the University of Phoenix announced that when its students return to classes this fall, many of them will not have to carry books but just to download digital textbooks, multimedia simulations and Power Point presentations to portable e-book containers and desktop PCs. This initiative is part of a plan created by the university to phase out traditional textbooks and become a "bookless college". As print-bound textbooks are everyday more and more heavy and expensive, publishers are realising the potential market for offering digital books that meet students' needs. The advantages of the e-book or text book to a student is clear. They are cheaper than printed versions, offer the ability to annotate, highlight and bookmark the text and teachers can easily compile study anthologies by mixing and matching chapters from different books. At the beginning of this year Adobe created the eBook U Initiative gathering around the company universities in order to study the use and impact of e-books in classes. The project helps teachers to create their own coursepacks in e-book version. Though, some students seem still reluctant to read on screens, which is a natural reaction, as we have seen in the last chapter. Nevertheless, if multimedia-infused digital text books come along as well as e-paper, the reality of a college with e-books in usage might not be that far away. One of the first projects in this area, even though it is not a study book but a reference one, is the Oxford English Dictionary (OED), a landmark in the evolution of the English language over centuries which had its origin in the Philological Society of London, in 1857. It is a commercial product from Oxford University Press whose on-line database15 and CD-Rom version nowadays contain the entire text of the 22-volumes of the paper edition.

15

http://www.oed.com/.

27

As early as 1982, Oxford University Press discussed the best way to bring the dictionary into the modern age. The traditional methods of compiling entries would have to be changed in order to allow a quicker updating of the dictionary. The only way of doing it was to have the source material transferred from paper to an electronic medium. Bespoke computer systems were then built for both pre-processing the text and editing it in electronic form and the text was marked up in a SGML encoding scheme. The first commercial product of that project came in 1992, the CD-ROM edition of the dictionary. Unexpectedly, a twenty-volume work shrunk into a slim disk. The electronic format revolutionised the way people use the dictionary to search and retrieve information. In 1997, the OED Online project begun and it was launched three years later, in March 2000. Nowadays, the OED text base allows complex searches of the entire text of the OED to be done in seconds. The text base includes tags (SGML mark up) that identify the fields within it. So, one can use the dictionary to find the definition or etymology of a word, quotations that include particular words or phrases and other more complex searches. However, the most relevant issue of the project is that its digital database allows a quarterly update of around 1000 new and revised entries. Next year, Oxford University Press will put on-line a 100 titles' collection of reference books as a new product that will be called Oxford Reference Online (ORO). The package will include The Concise Oxford Dictionary as well as OUP's paperback series of thematic dictionaries that cover subjects such as proverbs, classical literature and psychology. The Oxford English Dictionary digital versions are an example of how the digital space presents to reference books an endless capacity of information storage, an easier way to access that information and the ability to update it at any time, from any place of the planet and without leaving any remainder. The multimedia concept that allows the memorisation of image, sound and text does undeniably benefit reference books as well as study books by allowing the inclusion of more attractive ways of displaying information. The Internet, as it was said before, allows assinchrony, i.e., the coincidence of the action enabling several readers to read a single book that may be allocated in only one archive, at the same time and without having to travel. These characteristics of the digital space can improve the access and the performance of reference and study books but they will not make any difference regarding fiction books. And this, even though we cannot

28

ever foretell a market reaction, it is a good perspective for the success of the sales of reference and study books. However, are structures such as BOL or Amazon suitable for the selling of study, scientific and technical books? The majority of ecompanies that exist nowadays are not adapted to specialised publishing. They sell all types of books and, sometimes, more than just books and, therefore, have a promotional approach drafted for a general public, despite their attempt to give each customer a personalised service. To promote and be able to offer a good service of specialised supply of technical books implies knowing the specific target that you want to reach, where to find it and how to seduce it, if necessary. Being conscious of that reality, for instance, the French publishing group Havas is looking for other scenarios of e-commerce to promote and sell its reference, scientific, medical and technical e-products. It is an e-market to be explored and that needs to develop its infrastructures and modus operandi according to its special features. Traditional academic publishers like Taylor & Francis and John Wiley have joined the e-book and the print-on-demand business to extend their core activity to digital contents. To accomplish this goal, they take promotional actions near the college campus and eventually create, like Harvard Business School, editorial and news activities within web sites and electronic newsletters. Fatbrain.com's activity is similar but its main target are computer professionals and curious. Nevertheless, its promotional activity is adequate to the kind of books its sells, in this case, books related with the new technologies. Its electronic newsletter are structured by quite specific subjects within each cyber-area so that the client that receives may go directly to the section that he is interested in without loosing much time in reading the complete newsletter. Reference, technical and academic books, I believe, are possibly the branches of publishing that may have better chances of succeeding in the e-publishing world as, due to its characteristics, they are the kind of books that can take out the best advantages from the digital format. They can be enriched by what multimedia can offer them to help displaying information in a more attractive way, the digital format allows it to be sold chapters and be easily updated and makes possible to cross information in seconds between different e-books, or within them, through linkage. The mobility that e-containers allow as well as its storage capacity can also improve students way of handling information and of reaching it when it is stored far away.

29

3. THE MARKET 3.1. Commercial and / or cultural asset? As it is widely known, all major mankind inventions had a cultural beginning before they reached the commercial status. This reality is even more undeniable in the digital era we live in, in the sense that most of them come out of the research field and, more precisely, from the academic campus from all over the world. The original spirit of the Internet, the open background of research, lead to the idea that contents should be free-access. The several volunteer projects of storage of free-access cultural information in databases have been making their contribution to a democratisation of the access to content. But the free placement of text on the Internet in big quantities does not allow each user to perform a selective and effective research of what he looks for as there is not an authority that may regulate the integration of content on the Net. But, if inventions are a product from research, they are the best that can be done and that we can have. But is this the last stage before they step into the life of each one of us? First, they need to be accepted and considered important and necessary. I.e. they need to become commercial. But if you assume that they become commercial due to its high quality, will they forcibly become so? As we have seen in the late decades, the VHS video format has beaten the Beta one, considered much better, CD-I was seen as a masterpiece did not survive. It is the market, us, who decides. The original democratic spirit of the Internet has been overthrown by the creation of the e-commerce that implies investments, products and profit. A question should be raised, does everything have to become commercial successful to be able to survive? Are there projects that can survive without it in our money-ruled world? Fortunately, there seems to be academic and state projects who do not have commercial aims and who not only survive but also develop side-by-side with commercial ventures. Simultaneously, they make their contribution to the development of the initial democratic spirit of the Internet by allow a free access to its databases. These projects would easily named as cultural projects for they usually do not have any commercial aim. But, as we will see, nowadays, academic divulgation projects already include sales, not only for self-financing purposes but also to offer its users works that are relevant but that are not under public

30

domain and that are traditionally marketed. Examples of it are the eencyclopedias, e-thesaurus and "several-volume" e-dictionaries that cannot be offered for free. On the other hand, can every e-book that it is sold be considered only a commercial asset? Does it loose its cultural component just because it is sold? I don't think so. However, we cannot just say that the commercial/cultural division is obsolete. There's more to it than that. The idea of a cycle where something that it is invented, therefore cultural, afterwards becomes necessarily commercial and only commercial, does not make sense anymore. It is true that both concepts exist and will continue to. They just don't are that well limited from one another and can simply co-exist as we will see next. The idea is not new as it was already applied to traditional book market and it fits as well as in the new realities that are e-books and their contents. 3.2.Portugal Portugal is seen, by the marketing department of some companies of the New Economy, namely Internet service providers and mobile services, as a good environment to test market performance of the newest models of products and services due to the elevated rate of acquisition and usage of such products. However, does this mean that we, Portuguese, really have a new, digital attitude towards these new objects and services or we just adapt them to do things as we usually did before they were created? If we are that "digital", can the Portuguese market promise a successful environment for e-books' commercial ventures? If the reading rate is so low among us in what concerns the book market, how can an e-book business be successful? Can e-books lead to the acquisition of different contents than the traditionally bought? Are the companies that are starting e-book business selling a digital product or just presenting the digitalisation of a paper version? Is the e-book adventure in Portugal following the commercial path? These are some of the possible questions that we can ask before we can take a look into the Portuguese scenario. 3.2.1 Internet access in Portugal Numbers in Portugal show that there is a reasonable penetration rate of computers in the Portuguese everyday life and that the Internet accesses numbers are growing at a breathtaking speed. However, it also seems that still not every Portuguese pocket affords to buy a computer to have at home or even to have a permanent, house-based ISP paid

31

service and that the younger generation is the one more adapted in using it. The last data presented by Instituto das Comunicaes de Portugal (ICP)16 shows that the number of Internet accesses in Portugal17, at the end of the second trimester of 2001, were of 2.785.187, an increase 108,8% when compared with the 2000 numbers. This increase was motivated by the appeal of free access services as 89% are clients (mainly particular users) that chose this kind of access. Companies accesses raised from 27 535 accesses, from the first trimester of 2001, to 29 134, in the second trimester of 2001. Nevertheless, the companies' access may imply more than one user per access. Internet by cable has raised from 37 192, at the first trimester of 2001, to 55 358, in the second trimester of 2001. This results on a penetration rate of 27,8% at the end of the second trimester of 2001 against 21,1% at the end of 2000. Numbers of Internet users in Portugal
1997 Total number of clients Clients of free access services (4) Companies ' clients (paid accesses) (5) Particular clients (paid accesses) (5) Clients of cable service 1998 1999 (1) 2000 (2) 2001 (3) 1st trim. 2nd trim.

88 670 no activity

172 698 no activity

not available not available not available

2 110 772 1 860 694

2 503 744 2 219 816

2 785 187 2 471 055

16 469

28 588

28 600

27 535

29 134

72 201

144 110

not available

196 324

219 201

229 640

no activity

no activity

not available

25 154

37 192

358

1.The offer of free accesses by the Internet service providers began on the 3rd trimester 1999. The correct numbers regarding the clients of the access services to the Internet are not available. 2.The data regarding the year 2000 were corrected with new information that was missing. Among it there was the information of the companies that had not sent yet any information to the ICP. It includes previsions for the three companies in activity. 3.The number of clients of the 1st and 2nd trimesters of 2001 contemplates previsions for 5 companies in activity and from which was not possible to receive all the data in due time. On the 2nd trimester of 2001, one of the companies closed.

16

http://www.icp.pt/publicacoes/estcom/stcm/stdados2_01.html. Please see appendix 3.

17

32

4.The value presented is based on the information supplied by the Internet service suppliers, and it can consider situations where a user subscribes more than one service. 5.It was calculated the correct value of the desagregation of the number of companies and particular clients (Dial up). (Source: ICP)

Market penetration rate of Internet access services18

1997 Number of clients / 100 hab. (Source: ICP) 1998 1999 2000 2001 1st trim. 2nd trim.

0,9%

1,7%

not available

21,1%

25,9%

27,8%

These optimistic numbers could position the Portuguese people in the digital path, as it was mentioned before. However, the major issue here is that the access free of costs, specially at school or at work, is preferred instead of permanent, house-based ISP paid service, as it is seen as a still quite an expensive mean. The only exception is cable, which still is in early development stage of implantation. In a very recent study (that took place between 11th July and 6th August) made by the Observatrio das Cincias e das Tecnologias19, only 49% of the population use the computer, more 26% than in 2000. However, the good news is that the possession of computer per home has raised 44% between 2000 (27%) and 2001 (39%). The number of people who owns and use computers is clearly higher among people with a higher social condition, who have less than 40 years old (the highest peak is between 15 to 19 years old) and have a mediumsuperior or superior scholarship level. According to the same study, the percentage of Internet users (30%) rose 36% since last year (22%) and the Internet connections at home grew 125% (2000 - 8%; 2001 - 18%) and are among the most used ones, something that seems to contradict ICP numbers (if we assume that home connections are paid service) and that shows a new tendency. Still, one of the main reasons that make people decide not to have an Internet connection at home is because it is too expensive. Less encouraging is also the fact that only 3% of the population shop on-line, the majority (46%) only have an order made per year, but, still, the
18 19

Please see appendix 3.

Inqurito Utilizao das Tecnologias de Informao e Comunicao pela Populao Portuguesa - 2001 (provisory results), Observatrio das Cincias e das Tecnologias. http://wwwcisi.mct.pt/actividade.index.html.

33

items bought are usually books, magazines or newspapers. The numbers of the study of the Observatrio das Cincias e das Tecnologias show that habits are starting to change into a good direction, even though in a quite slow velocity. As important as the issue of accesses and computer usage, are the operating capabilities of the Portuguese web sites. Even though we cannot conclude if the Portuguese users consult more Portuguese or more foreign web sites, it is certain that they will visit web sites in their own mother language and therefore its operating capabilities are relevant. According to a research made by Compuware, 65 % of Portuguese web sites are too slow. As it managing director for Portugal and Spain, Ms. Linda Garcia-Rose, say, "Portuguese sites have not yet achieved the quality to compete on a global market level. The response time is higher than 20 seconds, which makes the ability to gain clients more difficult since, after the waiting time, nearly 46 % of users abandon the site, and 9 % do not return again."20 The non-existence of image height and length parameters, which covers 48 % of the sites analysed in this research is one the major slowness factors. Another study reveals that the three most common deficiencies are the loss of attributes, the failure to update sites (for a period of six months or more) and the rupture of internal links. This factor certainly has an inhibitory effect on the average user that has more than 40 years old, who usually is not very fluent in English as it is, for instance, in French and, for that reason, has the tendency to look for web sites in its own language. 3.2.2. Digital attitude Illiteracy and info-exclusion According to the OCDE, literacy is the capacity to understand and use written information in daily activities, at home, at work, in society, the ability to develop acquired knowledge and accomplish aims. If literacy and scholarship are not the same thing, then Portugal is seen as a case study of the close connection between the level of scholarship of a population and the impact that that might have in the literacy level. The sociologist Antnio Firmino da Costa21 says that "there is in Portugal an elite that works very well in writing and the majority - more than two thirds of the population - does not know how to do it".

20 21

http://www.europemedia.net/shownews.asp?ArticleID=1588&Print=true (21/02/2001). Anurio da Comunicao 2000-2001, Lisbon, Obercom, 2000, page 593.

34

More than 70% of the Portuguese population with levels 1 and 2 of literacy is employed. The situation is getting worst and it is particularly worrying in Portugal as the labour market requires everyday higher and higher capacities of reading, writing and analysis and it is already visible that, in the most dynamic economies, the workers with higher levels of literacy have better chances of answering the flexibility demanded by the labour market. Things get even worst because the birth rate, like in most European countries, is lowering every year, and consequently the population in its whole gets "older" every year. The government effort to create a digital educational network by supplying the schools with computers connected to the Internet and by supporting educational digital projects can be also seen as an attempt to prevent that when the studying generation of today gets to adult age, will not be so digitally illiterate than the one that exists today. It is also an attempt to democratise the access to the digital world, by giving the equal opportunity to everyone, "poor and rich". Mobile Phones The buying and subscription of mobile phones and its services is a field so successful among the Portuguese as the Internet access. At the end of the second trimester of 2001, Portugal presented more than 7,2 million clients of mobile terrestrial service. In the same period the number of new subscribers was over 245.000. This value sets, according to a study from the Instituto de Comunicaes de Portugal22, Portugal on the 10th position of the chart of the countries of the European Union, with a penetration rate of 71,9%, higher than the European rate (69,4%). According to the same study, in the last 12 months, 2 million new clients joined the mobile terrestrial service and the average time of conversation raised 10% during the same period of time, reaching a value that outgoes the 2548 million of minutes. The high percentage of clients of mobile phone services does not mean, however, that Portuguese people have a digital attitude towards the digital technologies, in this case communication technologies, as the use they make of a mobile phone is similar to the use of a traditional phone. They use it more to speak and send messages than they feel attracted to connect to the Internet and use the services offered by mobile phones companies. It is undeniable, however, that for this situation contribute the low variety of the WAP services and the high prices paid to access them.
22

http://www.icp.pt/publicacoes/estcom/stcm/smt2_01.html.

35

3.2.3. Buying contents Nonetheless, despite absence of a digital attitude in the communications field, Portuguese people accepted quite well the first digital content products, like CD-Roms, when they first reached the Portuguese market and even lead them to consume kinds of contents that they traditionally did not buy, at least regularly. As Roberto Carneiro, CEO of the Forum Group (at the time), already wrote in 1998, "it starts to come out with some importance new categories of contents: technical and professional, utilitarian, educational and leisure. The new means seem to answer to growing important needs () The effect of multimedia on the buying of contents reveals itself in its new capacity of leading the consumers to buy contents that they usually did not buy in the traditional formats, due to its lack of expression and attraction." The new formats "created new patterns of perception and relationship with contents."23 However, it seems that the current attitude continues to be clearly analogical, but, in this field, with some sprinkles of digital sophistication. These new means show different levels of attraction to the consumer. The major volume of content sales24 is within the areas of information, fiction, leisure, entertainment and professional education, what makes them strategic contents to explore. The most successful digital contents (Internet and CD-Roms) are, however, utilitarian, leisure and educational whilst in the traditional means (i.e. television, cinema, video, press and books) the information, fiction, entertainment and sports dominate. In the field of the traditional contents, 15% of the interviewed people showed lack of satisfaction toward today's available products. This is due mainly to the difficulty of the traditional mass media in satisfying the existing needs in the professional and hobbies areas. The functionality and the interactivity of the new means bring an added value to content. For 65%, CD-Roms are easy to use and for 73% make the content more attractive. 24% agree that the new means lead to the consumption of contents not usually consumed through the traditional means. Among these new areas are computers (38%), culture (37%) and information (21%). But still, they are considered too expensive.
CARNEIRO, Roberto, "Portugal Digital - Atribulaes de uma Sociedade em Transio", Tendncias XXI, n 3, Lisbon, AODC, March 1998, pp. 47-8 (Estudo: Consumo de Contedos em Portugal encomendado pela Associao Portuguesa para o Desenvolvimento das Comunicaes Euro RSCG Consulting).
23

"Estudo: Consumo de Contedos em Portugal", publicado in Tendncias XXI, n 3, Lisbon, AODC, March 1998.
24

36

The industry of contents faces a kind of behaviour based on old professional habits and by habits of fashionable and modern buying. 3.2.4. Reading habits in Portugal Even though we never can predict how the market will react to a new product, in the case of e-books reading habits are one of the few but surely one of the most decisive indicators of how a market may react and condition its performance. If the reading over paper, and specially on books, has been showing for centuries that this material is, so far, the most eye-comfortable medium for reading, will screens, for how much improved they may become, change reading habits rates? It seems a bit difficult. Reading According to a research25 made by the Portuguese Association of Publishers and Booksellers (APEL) in March 2000, 84% of the Portuguese population with ages between 15 and 65 years old says that they read books or magazines. However, only 48% declare that they are reading a book at the moment and the majority are older people. When asked when was the last time they read a book 44% answered that it was less than a month ago; 37% less than a year; and 8% more than a year. The average number of books read per year is 8, being that 31% read 3 to 5 books, 25% 6 to 10, 24% 1 to 2, 12% 11 to 20, and 5% more than 20 books. The average weekly time dedicated to reading is of 4 hours even though more than half of the readers (53%) read 3 or less hours per week. Buying 50% of the Portuguese population say that buys books while 76% buy newspapers or magazines. 61% of the buyers say that bought a book less than one year ago, while 26% declares that it was less than a month ago. Only 9% bought books more than a year ago. The average number of books bought per year is 8,6. 19% buy 3 to 4 books, another 19% buy 5 to 6, 18% 7 to 10, 16% 1 to 2, 14% 11 to 20 and 6% 21 to 50 books. The average number of books per home is of 155 and the majority are encyclopedias, dictionaries, general literature and scholar books, not we can call "readable from the beginning to the end". Nonetheless, despite all these factors, there are companies decided to give e-books a try.
25

http://www.apel.pt/livro/habitos1999/habitos.html.

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3.2.5. TexEdiNet, the first Portuguese distributor of e-books The world of e-books only very recently reached Portugal. Media Books, a digital bookshop created in 1995, started distributing e-books in March 2001. Initially, Media Books was created to sell books, videos, DVDs, games, CD-Roms and other multimedia products and, nowadays, it has around 60 328 products registered on its database and a list of 23 237 clients. It deals with 805 publishing houses (557 Portuguese and 248 foreign). Media Books is a brand of TexEdiNet, a sub-holding of the Texto Editora, a group specialised in educational books and material. TexEdiNet manages the Internet26 businesses, interactive television and all subjects related with the New Economy. The distribution of e-books came along with the renewal of the web site of Media Books. TexEdiNet invested 350 000 Euros in Oracle technology27 to renew the front-office and back-office of the web site and enlarge the number sections of products, displaying them in thematic order, the number of promotional campaigns, services, newsletters, functions, velocity, to have an advanced research system, a chat section, interviews with the authors and to create the possibility to sell e-books readable by the Acrobat E-Book Reader (former Glassbook Reader). The investment made will be regained, according to Media Books previsions, during the year of 200428.

TexEdiNet has on-line several web sites: http://www.te.pt (publishing house), http://www.educacao.te.pt (web site for teachers), http://www.universal.te.pt (encyclopedia), http://www.mediabooks.pt (bookshop), http://www.star.pt (information regarding the Portuguese showbusiness), http://www.junior.te.pt, and http://www.jovem.te.pt.
26

Oracle8i; InterMedia Text - indexation and research; programming in Java Server Pages and PL\SQL; Oracle JDeveloper and Business Components for Java - administration.
27 28

See appendix 1.

38

Media Books acquires, through TexEdiNet, rights for exclusive online commercialisation of books in all digital channels. The selling of ebooks is made by transmission of electronic data that allows the representation of text in a screen of electronic reading device that it is not resumed to the PC and that displays some extra functions like the research throughout the text. The project aims at, in this phase, selling only books (not magazines, newspapers or any other periodical publication) and in Portuguese language. When the Acrobat E-Book Reader is downloaded, a demand for recognition of the program is made on-line when we first use the program and it is established a connection to the servers of the company. After this, the client connects itself to the server of Media Books where the password supplied by Adobe is validated. After, the download of the chosen title to the computer of the client is made available. The file with the text is sent to the client through the available net of communication channels (Internet, cable, etc. and, in the future, WAP, UMTS and interactive television). In order to protect the intellectual property of the content of the files, the text is downloaded encrypted with a password that allows the immediate reading of the book and the client has to be registered. This system avoids the temptation of having a copy of the e-book made or its installation in other computer(s). The client may be allowed to print the text for personal use, in a controlled way, or even edit the book. These two privileges can be previously defined by the editors of each title and be

39

specified as "conditions of use" before the client makes the download. In this way, the editor can specify, for example, that the client can print 150 pages from six to six months or that the book will be readable only during one year, at the end of which its validity expires. In the first phase of the project, Media Books will launch 2629 ebooks, all from Texto Editora catalogue, hoping to reach 700 titles from other companies by the end of 2001, i.e., 10% of the total quantity of books published in Portugal per year. The main goal of the project is not the on-line edition of books, but simply its on-line distribution. I.e., Media Books has no responsibility over the content of the books it sells or over the author's royalties. Their aim is to distribute e-books from the largest possible number of publishing houses, mainly from the area of fiction and technical books, namely of law and management. The advantages to the consumer presented30 by Media Books are the immediate consume of the product; a more comfortable handling and transport; the reduction of around 30% on the selling price; the access to separate chapters or parts of the book, if necessary; it does not go out of stock; and the capacity of research and linking inside the book. On the other hand, the advantages to the editor will be a higher number of clients; the absence of production costs; the adaptation to a new generation and a new market that does not compete directly with the traditional market of the book; a possible lower number of piracy and reproduction of books by xerox copy; the total control of the business chain; the total control of the printing of the text; a possible higher value of sales when compared with the sale of books in the traditional market. The TexEdiNet project does not show anything new regarding the business model. It copies what most foreign ventures are, an on-line distribution network that sells directly to the customer through an online bookshop, and therefore imitates an already existing business model. There is no editorial activity and, consequently, no innovation and it is self-protective step just to show a position in the market. There is no attempt to find new authors and new titles and promote them in order to improve paper books' sales. The model lacks specialisation as Media Books seems to be open to sell any type of e-books and promote them in the same way despite they are reference books or novels. The
29 30

Two educational titles, three fiction, six reference, four technical, five philosophy, six learning ones.

All this data was supplied on the meeting promoted by Media Books to present the e-book system of sales, on the 19/02/01, at the Sheraton Hotel, in Lisbon.

40

only benefit to the customer can eventually be to have the book earlier than the printed edition31, if it is a new book and it is launched in digital format first. The regain of the investment made (350 000 Euros, despite the fact that it is a global investment that includes other areas in the Media Books web site) by 2004, in a state of affairs where most international projects are sceptical, is quite optimistic. The price of Media Books' e-books, a suggested reduction of 30%, is still high when compared with the price and costs of the average traditional book.

BASIS OF THE SELLING PRICE OF THE PRINTED BOOK IN PORTUGAL

The values presented on the chart vary within the following limits: The printed edition of an average Portuguese title (250 pages) takes two months to be done since it starts to be produced until it reaches the publishers' or distributors' warehouse. It has to pass through composition, revision, author's revision, cover design, making of films, colour proofs and ozalids approval, paper, printing. It will take two more months being translated, if it is a foreign title.
31

41

* 15% to 20% - industrial costs * 10% to 12% - author's royalties * 10% to 20% - publishing house profit plus marketing and promotion costs * 54% to 60% - distribution (from which 50% go to supermarkets or big bookshop chains and 35% to traditional bookshops).

All these values have as basis the cover price of the book without VAT. The industrial cost is multiplied six times to get a profitable selling price. Very recently Barnes & Noble started selling its own published ebooks at prices that range from $5.95 to $7.95, quite different from the hardcover paper titles that may go up to $ 20. Moreover, there are no significant industrial costs (production of the book32), as they are only distributors, and the percentage of Media Books over the selling price (without VAT) of the e-book is 50%, the same percentage of the traditional distributors of paper books. It should be lower as the current costs of distribution33 are almost minimum and there is no percentage to be given to traditional or chain bookshops. Even knowing that they have to take into consideration the money invested in new technology and structure costs, those are easily regained after a certain period of time. On the other hand, the possible lower number of piracy and reproduction of books by xerox copy will be a bit difficult with such a small reduction of the price. The contract34 with the publishers is signed on a exclusivity basis and has a preference clause which is very restrictive and as the format and the platform are not specified, TexEdiNet will be able to use freely, without any kind of control, the content supplied as it wishes. Nevertheless, the bet on the areas of fiction, technical (law and management) and reference titles is well thought. 3.2.6. Clix and the first Portuguese interactive e-book In the beginning of June 2001, during Lisbon Book Fair, a Portuguese writer, Zui Zink, in collaboration with the publishing house Publicaes D. Quixote and with the Internet portal Clix (Sonae Group) 35 , launched the first Portuguese project of an interactive e-book. The ebook was a written-in-progress fiction book called O Surfista (The Surfer)36. The first chapter, written entirely by the author, was put onThese include advance payment of royalties, translation (if it is book in a foreign language), composition, revision, cover design, films, colour proofs, ozalids, paper, printing and the payment of human resources of the editorial and production departments.
32 33 34 35 36

No salesmen, warehouse and shipping costs. See copy of the contract in appendix 2. http://www.clix.pt. http://ebook.clix.pt/.

42

line on the 1st June and over a period of 3 weeks there was a new chapter on-line every Mondays, Wednesdays, and Fridays based on the suggestions given by the e-readers. The suggestions of the readers were based on the result of the voting of several hypothesis presented as continuation of the story. Besides the directory of the web site where the writing of the story takes place, there were other directories with other activities that allowed each reader to consult the results of the online voting, sending texts, get to know the characters of the story. The results were not made available by Sonae but were considered "quite good". The book will be published, in paper version, by Publicaes D. Quixote.

Very recently, the Portuguese daily, Pblico, has started, in its web site, what it is called a interactive urban fiction story37 (Venha o Diabo e Escolha) written by a well-known Portuguese pop singer, Miguel ngelo, whose text will be later published in paper version by Oficina do Livro. These are examples of how literature can be specifically created on the Internet, where the reader chooses in the writing of the text one of several hypothesis becoming in this way co-writer of the story. This will lead to a new way of story telling where the reader steps into the other side and becomes a creator, leaving its traditional passivity and
37

http://www.ebookmagnum.publico.pt.

43

becoming active? From a simple text consumer he will become an interactive user? What about the publisher? However, not all the projects and ventures related with e-books and e-publishing have to ask these questions. Some do not deal with selling of with preserving and making available texts without any firsthand commercial aim. 3.2.7. The Portuguese National Library and the DiTed project One of the most wanted kind of texts and which have a higher need for mobility and availability are research texts like thesis and dissertations. These texts in Portugal have a rather difficult access to commercial publication and, so, they barely enter the logic of commercial and profit laws. Therefore, it will not be reasonable to fit it in the concept of what it is called commercial e-book. Nonetheless, they are texts that need to be preserved for creation (author's creation) and corporate (national body of cultural items) reasons and, more than that, for "usefulness" reasons (research). The Portuguese National Library, the organism that regulates the deposit of the Portuguese publications has felt the need to solve the problem of the deposit of digital publications and of using the digital format and the Internet to promote, make world-wide available and disseminate the works of the Portuguese researchers. The Legal Deposit The law established the "Legal Deposit" was approved in 1982 (Dec.-Lei n 74/82, 3rd March) and it says that every publication edited or printed in Portugal and the ones printed outside Portugal but edited by a publishing house established in Portugal should have one or more copies archived in the Portuguese National Library. This law also comprehends thesis, dissertation papers and any other kind of texts related with the career of college teachers. The aims of this law are the defence and preservation of the values of the Portuguese language and culture; the creation and preservation of a national collection of all the publications edited in Portugal; the production and divulgation of the national current bibliography; the elaboration of statistics of the Portuguese publications; and to enrich the libraries of the main Portuguese cultural centres. New needs and projects

44

In the last years, The National Library has felt the need to enlarge this mission in order to cover the world of the publications in digital format, namely the ones on the Internet. For that reason, it tried to reassure the protection of the interests of all agents involved, to bring added-value to them, and make producers aware of the importance of the preservation of such publications. To deal with such problem, the Portuguese National Library is involved in several national and international projects (NEDLIB, PURL.PT, LIZA, DROP, and DiTeD). These are being developed with the help of partnerships with several entities (University of Lisbon, Department of Computers from the Faculty of Sciences; the department of Sciences and Technologies of Information from ISCTE, the Group of Telematic Systems and Services from INESC (Instituto de Engenharia de Sistemas e Computadores), the ISEGI from University Nova of Lisbon and the IST (Instituto Superior Tcnico). NEDLIB is an international project, that took place between 1998 and 2000), that gathered several European national libraries and aimed to discuss, in an integrated way, the problem of the digital publications according to the internal perspective of the institutions of deposit, with the identification of requisites and models. PURL.PT, a global initiative begun at the end of 2000, that aims to develop a technological infrastructure of gather and deposit of digital publication in the Portuguese National Library. LIZA results from a partnership with INESC and studies the problem of the deposit of technical and scientific documentation. DROP studies the problem of the deposit of periodical publications on the Internet. The DiTeD Project The DiTeD (Digital Thesis and dissertations)38 project aims to promote an on-line access to the thesis and dissertations delivered by Portuguese researchers through the creation of a distributed digital library, i.e., an optional digital circuit based on the Internet for the deposit, registration, preservation, research and access, in digital format, to those documents. It was created in partnership with INESC and the IST and is connected with other similar systems all over the world within the reach of the Networked Digital Library of Thesis and Dissertations (NDLTD), organised by the Michigan University and by the Virginia Tech Institute. The aim of this international network is to bring to light the works produced within the academic world and to make easier the access to them.
38

http://dited.bn.pt.

45

The DiTeD project has created a new way of delivering thesis and dissertations and keeping, at the same time, a closer co-operation relationship between research centres. The Portuguese universities and institutes agreed to join the project and the Portuguese National Library hopes to convert into digital format, in the next two years, the 10 000 thesis that it has on its archives. This project is related with the LIZA project and it is quite developed, hoping to reach a final system very soon. It is also open to works written outside Portugal but with clear national interest, such as the ones from Portuguese researchers or that focus on Portuguese related themes. How does it work 1st step - The student writes its thesis using the digital library to consult other thesis. 2nd step - After finishing and of being approved, the thesis is sent to the student's university. At this stage, the author of thesis express if he wishes that his thesis is access free, if only in its university or totally inaccessible. 3rd step - The Portuguese National Library accesses regularly to the university's system to make the legal deposit of the thesis. 4th step - According to the conditions of access determined by the author, thousands of users all over the world will be able to consult and read the thesis. The overall goals of the project are to make easier the process and reduce the costs of the delivery of a dissertation or thesis; to promote the results of scientific research done in Portugal or in some way related with Portugal and its culture; to allow Portuguese and foreign researchers to have an easier access to these results; to promote technology and the use of digital libraries in Portugal; and to preserve in a long term, and by digital means, an important part of the national scientific knowledge. This project and all the Biblioteca Nacional policy towards the preservation, dissemination and making available Portuguese academic thesis and papers and the capacity of uniting Portuguese universities in this project is praiseworthy and shows how a non-commercial perspective of e-publishing can be developed. Regarding the questions asked at the beginning of this chapter, these are discussible and can be reformulated. Do Portuguese really

46

have a new, digital attitude towards these new objects and services or we just adapt them to do things as we usually did before they were created? It does not seem reasonable to assume that high rates of Internet accesses and mobile phone usage are synonym of a change towards a digital attitude and, therefore, we cannot foretell by this way what will be the Portuguese market reaction toward the appearance of e-books. If the reading rate is so low among us in what concerns the book market, how can an e-book business be successful? Considering that the support of reading of e-books, screens, are quite far away of presenting the qualities that the paper presents for a eye-comfortable and easy reading, it will be certainly decisive the rate of reading through a traditional mean as the paper. Can e-books lead to the acquisition of different contents than the traditionally bought? According to the analysis of the market performance of CD-Roms in Portugal, in the sense that they may represent an hypothetical term of comparison with future e-books performance, they can even have lead to the buying contents not traditionally bought but this happens mainly because the traditional means did not satisfy the buyer in quality, availability and variety and not truly due to a change towards a more digital attitude. It is more an extension of old habits of acquisition and "fashion" habits. Are the companies that are starting e-book business selling a digital product or just presenting the digitalisation of a paper version? The Media Books e-book project is a distribution model that in terms of business model does not innovate, when compared with other European or American examples and does not introduce any change in the concept of publishing a text. Is the e-book adventure in Portugal following only the commercial path? Fortunately, side by side with the Media Books commercial venture, the Portuguese National Library has been developing another insight towards e-publishing more directed to research, the noncommercial circulation of texts and its preservation. However, in an overall view, it can be said that Portugal, despite all the illusive high level of buying and subscription of high-tech products and services, is quite far behind a true change into a digital mentality and just stepping in, for the first time, in some fields of the New Economy like e-publishing. Nevertheless, and on one hand, we cannot deny that projects like the National Library are interesting but

47

that, on the other hand, commercial ventures like that distribution of ebooks by Media Books show no sign of innovation in terms of business model in the field of publishing. We hope that the upcoming ventures bring something new and that can be accountable as an extra point in the evolution of European e-industry and e-services.

3.3. Europe Since the beginning of the second half of the XX century that the generalised idea of technological supremacy of the US has grown more and more consistent. The breath-taking rhythm of the development of American research and industry and its worldwide success has overshadowed Europe giving it the look of an old monster fed by public money. It is a hyperbolic vision but it has its little essence since it is undeniable that most European countries do not have a relevant role within the digital revolution scene and most Europeans only now start to respond more significantly to the use of the new media. An illustrative example of it is the percentage of households with Internet access at home. While in some countries from the north and centre of Europe, like Denmark (51,6%), Finland (43,5%), Sweden (53,8%) and the Netherlands (54,8%), have quite high rates that surpass by far the European average (28,4), other countries like Greece (11,7%), Spain (15,7%) and Portugal (18,1%) present very low penetration rates what shows a quite unbalanced scenario. However, countries like Germany, Greece, Spain, Ireland, Luxembourg, Austria, Portugal and Finland have seen in 2000 a significant rise in numbers as it can be seen on the chart that follows. Still, the European average (28,4%) is very far away from the American one (46,7%).

Level of Internet Access in Europe39

39

Please see appendix 3.

48

(% households with Internet access at home)

Eurostat Report40

Belgium Denmark Germany Greece Spain France Ireland Italy Luxembourg Netherlands Austria Portugal Finland Sweden United Kingdom Iceland NO EU15 US Japan Notes:

April 2000 20,2 45,3 13,6 5,8 9,6 12,9 17,5 19,2 26,9 46,1 16,9 8,4 28,2 47,5 24,4 : : 18,3 : :

October 2000 29,2 51,6 27,1 11,7 15,7 19,0 35,5 23,7 36,3 54,8 38,0 18,1 43,5 53,8 40,9 : : 28,4 46,7 :

(1) All forms of use are included. Population considered is equal or over 15 years old. (2) Eurostat will collect available data from Member States from 2001 and launch household surveys in 2002. (Source : Eurobarometer Survey)

It is true that the European Commission has a program that contemplates e-books and e-publishing. Culture 2000's (1/01/00 31/12/04) ultimate goal is to give value to the cultural ground shared by the European people and within this policy and it contemplates the support and financing of projects in which publishers and authors may seek to explore the area of e-books and e-publishing within the perspective of a multilingual distribution. However, this program does not make the European world. In 1998, when we started hearing about e-books and e-publishing more frequently and in a more commercial perspective, it seemed that the feeling of delay would fit in. However, things do not seem to look that pessimistic. In general, reading habits in Europe are a consolidated issue and book's sales show a very stable market in most European countries. Consumer habits related with the new technologies, despite the economical differences between European countries, are also
http://europa.eu.int/comm/eurostat/Public/datashop/print-product/EN?catalogue=Eurostat&product=124010pc-EN&mode=download.
40

49

changing, as we have seen by the level of Internet connections in European households. Europe has given birth to several media groups, like Bertelsmann and Vivendi Universal that have attained a global dimension. Their variety of core areas of activity like TV, Internet, magazines, books and newspapers, has developed from an European basis and has expanded overseas, in many cases buying major American companies (i.e. Bertelsmann buy of Random House or Vivendi buy of Universal Pictures). European mid-size companies start to bet on e-commerce and e-promotion of its products. Other companies, of smaller dimension, have played innovative roles in the evolution of e-technology (Cytale) and e-commerce (ditions 00h00.com). ditions 00h00.com was one of the first commercial web sites in the world to start selling e-books and two years and a half later Cytale has presented the first European container of e-books. Two of major European media groups, Bertelsmann and Vivendi Universal, have started their way into business globalisation and despite the fact the Internet and e-books' euphorias have cooled down, they are still taking their chances in that area. Publishers, like Gallimard, have followed the lead and the French pioneering experiences of Cytale and 00h00.com have been helping publishers to reflect on the problems presented by the electronic edition of its catalogues and by distribution of electronic books that will be the basis of its work in the years to come. Last year, the first e-book award was created in Frankfurt. We cannot foretell the future of the adventure of e-books and e-publishing in Europe but it is a good start to have such rumbling over the subject. 3.3.1 - Bertelsmann The media group created by Carl Bertelsmann 166 years ago, in Germany, has a wide range of interest areas such as books, music, direct sales and the Internet in 54 countries. It owns the major conglomerate of publishing groups in the planet by uniting under one hand Random House UK, Random House USA, Circulo de Lectores (Spain), Bantam Books (USA), Doubleday, National Geographic, Bertelsmann Springer, among others. Bertelsmann owns Bol.com, a net of localised online bookshops, created in 1998 from a 50/50 joint venture between Bertelsmann and

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Vivendi Universal Publishing and that acted until very recently in 13 countries41.

In October 1999 Bertelsmann42, announced a partnership with Xerox to develop worldwide POD (print-on-demand) web sites. It was the next step of Bertelsmann group in the digital book world after the opening bol.com. The POD will help to cope with the problems of the immediate need to do reprints, more personalised editions and of small print-runs, inferior to 700 or 600 copies, assuring nowadays a production of 5% to 6% of books worldwide. According to Pierre Danon, the CEO of Xerox Europe, the percentage will probably grow 30% within the next five years. The common goals were the making the POD of hardcover books and putting on-line books for on-line ordering and digital printing by demand. For Bertelsmann, this means the possibility to offer to its clients an integrated service by developing platforms for its publishing houses, book clubs and virtual bookshops and by that way exploring another distribution channel that will reach in seconds any client in the planet and without getting out-of-stock. A few months later, in January 2000, Bol.com signed a deal with the manufacturer of Rocket e-book, Nuvomedia, to begin selling its reading devices and associated titles through its web site in the United Kingdom. It was also created a 50/50 joint venture with iSyndicate (iSyndicate Europe) that will supply contents for the online media, web sites, portals and mobile phones. To cope with the different promotional needs that any product to be commercialised on the Internet faces, two months later Bol launched
41 42

Japan, Malaysia, Singapore, Scandinavia, Germany, France, Spain, UK, Italy. "Livre la demande: Xerox et Bertelsmann investissent ensemble", Livres Hebdo, 22/10/99, page 5.

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Web book TV, the first of several daily web casts, being this one an interview with Jeffrey Archer entitled "Relax with a Book". The web cast format gives BOL.com users the opportunity to buy the book that is being promoted at the moment and other back list titles from the same author and to participate in online question and answers sessions and even ask, by e-mail, for signed books. In June 2000, in order to congregate its e-services activities, Bertelsmann planned to bundle them into an e-commerce holding, Bertelsmann E-Commerce Group, that would also include Bertelsmann Broadband Group, Bertelsmann's digital multimedia content provider. The goal of this concentration is to create conditions to become the world's number one on-line content provider and retailer of books, CDs and DVDs. On October 2000, it was the time for Random House UK, one of Bertelsmann publishing units, to become the first UK trade publisher to enter the e-book market by unveiling a e-book list of more than 100 fiction and non-fiction backlist titles drawn from its own and Transworld imprints to be launched before the end of the year. Authors like Louis de Bernires, Frederick Forsyth, Thomas Harris, Ruth Rendell and Irvine Welsh signed up for an initial three-year period. Like AtRandom, it would pay to its authors 15% of the cover price of the hard copy edition since the download price of the e-book would be the same. The planned evolution of the project is to emphasize its frontlist and specially the British authors even though not despising the American ones also present. Despite the huge deficit of its online activities presented in June 2000, 997 millions marks (60 millions in the book area and 726 millions in the media field), Thomas Middelhoff, the chairman of the German group, announced, in September 2000, that the investment in this area will continue. But on May 2001, Bertelsmann announced that intended to gather and integrate the BOL subsidiaries in the Bertelsmann Club (BCA - book clubs), its direct sales structure, in order to compensate for the financial losses of its on-line bookshops. BOL lost the first round against Amazon.com in the battle for the major market share. With this new strategy BOL lost its independence in countries such as Germany, The Netherlands, Sweden, and United Kingdom and it may reach France and Japan. The speed of the change of the image and the adaptation to new challenges that Bertelsmann is suffering is breathtaking. The Internet allows its book businesses to reach its clients within minutes, not within

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days by mail as it was with the book clubs, and there will be no more out-of-stock situations. The idea of having, in the same group, the selling of paper books, e-books, POD books, e-book containers (Nuvomedia), have its own production of contents for the Internet (iSyndicate) and sell it in all different platforms and machines is a global perspective of exploring all the elements in the commercial chain and not having to depend on anyone to have them. It is the idea of globalisation applied not to the geographic perspective but to business insight, i.e., have access to all these elements and explore them commercially. However, the complementarity of all these elements does not mean that Bertelsmann will try to become specialised in each field but simply to set strategic alliances that enable the group to explore these different areas. Also the conscience of the need of a new promotional way for selling products in a new channel, the Internet, like promoting books and authors through web book TV, is a sign of the adaptation to the new world as well as the restructuration of the areas of the group. The regroup into specific core business areas that should develop their activity but that should, in the end, contribute for the same end is a step toward globalisation as separate core business areas separately would never be able to have any significant results in the New Economy world. 3.3.2 - Vivendi Universal Vivendi Universal was originally a French water and waste-service company, Compagnie Gnrale des Eaux, created by Napoleon III in 1853. Nowadays, is a transatlantic empire combining film (Universal Studios), music (Universal Music Group, MP3.com), TV (Canal Plus), publishing (Havas Publishing and Houghton Mifflin) and digital delivery systems (Vizzavi and Cegetel) whose aim is joining content, delivery and the use of technology to create wider, faster and more flexible points of access to information and entertainment. It has undergone significant changes in the last five years. Like Bertelsmann, is a content provider as it creates and distributes personalised information, entertainment and services to consumers anywhere, at any time and across all distribution platforms and devices. One of its ventures is the e-publishing area, where its main publishing unit, Havas is developing several projects. At the end of 1999, Havas had already as aim to create and develop multiple

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synergies between its printed editions and the electronic format. As Agns Touraine, Havas Publishing's ceo, put it at the time, "The public will need the same contents, but edited in a different way"43. With an already considerable international activity, namely through Havas Interactive, with partners from Spain (Anaya) and Brazil (Atica/Scipione), Havas aimed to reinforce its position as a highly internationalised content group. Being a group whose activities are mainly directed towards education, reference and derivated products, it has developed several projects like the CD-Roms of the Klio encyclopedia, co-edited by Larousse and Havas Interactive; the Won.Internet, the first European platform of games; and the Education.com, a web site for young children up to 10 years old. The most interesting project so far was presented in July 2000. It is the "cartable lectronique" for students, a A4 format, 2,5 cm thick and Internet connectable screen developed by Siemens with the collaboration of the Nathan and Bordas publishing houses. There will be two versions, one for students, another for teachers, and it can contain two scholar books and a dictionary that can be downloaded from Havas web sites. In October 2000, just before the beginning of Frankfurt Book Fair and anticipating Bertelsmann presentation of its digital contents strategy, Havas announced the creation of ePocket, an imprint to explore subsidiary rights and to launch titles in new formats, and that will dedicate its activity to the conception of publishing lines adapted to the electronic devices. ePocket.fr44 was then the first European multiplatform web site of download of digital literary contents. The web site was on-line in November with a hundred titles from Havas Poche catalogue available to be downloaded, at the price of a paperback, to be read on a PC or on a Palm Pilot or other personal digital assistant. Since January 2001, that all the books edited by Havas are available in Open eBook format what enable them to be read in any of the available electronic platforms The ePocket web site is an emanation of Havas Poche. Besides the literary texts that it has available, it also offers the readers the biography and bibliography of each author, interviews and press-files. In order to download the text that you chose, you only have to select the platform in which you wish to download it and register. The payment is done at the moment of the download by credit card. There is no
43 44

TOURAINE, Agns in Livres Hebdo, n 359, 26/11/99, pp. 59. http://www.epocket.fr.

54

possibility of printing or copying/pasting it due to security reasons of the entire system. Later, came up an agreement with Microsoft for the exploration of the market of electronic books through the use of Microsoft Reader and its ClearType Technology and a joint venture with Maury Imprimeur, one of the POD pioneers in France, to create a small print-run stockage and a POD unit called Bookpole, which will be the first integrated chain of distribution and printing. A globalised business strategy similar to the one adopted by Bertelsmann. Havas is also investing in the development of new technologies' projects as it is sponsoring the American project of e-Ink, a paper prototype that uses the famous electronic ink (see chapter 2). Despite the worldwide pessimism of the stock market, the secondquarter earnings of 2001 for Vivendi came out much better than what was expected. However, some financial analysts agree that45 "Messier has done a great job bringing all these well-run, financially healthy businesses together, but he's yet to prove the vision he assembled them around is credible. () Turning a capacity for synergy into tangible results is something AOL Time Warner is just starting to achieve." Besides not being able yet to articulate the synergies within the group into visible results, Vizzavi, the multi-access portal business, created in partnership with Vodaphone, has not been very successful. Its aim was to allow people to get their e-mail and surf the Web and get contents over mobile phones, personal digital assistants, personal computers and interactive TVs. However, the slowness and the high price of the Wireless Application Protocol (WAP) services crashed any hopes. The PC service and the mobile-phone service only work in some countries and the PDA and interactive TV systems are not ready yet. Also the distribution of Vivendi's contents in the U.S. is threatened by AOL, who has a clear advantage, specially in the domain of broadband distribution. Vivendi will have to fight a few more battles to rich a consolidated globalisation and efficiency status.

3.3.3 - Gallimard In the beginning of 2000, Gallimard, one of the major French publishing groups, announced the intention to buy Bibliopolis, an on-line
45

Ibidem.

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publishing house specialised in Human Sciences whose commercial activity is directed to schools and libraries, in order to create a new imprint, Gallimard Numrique, and enter the Internet e-publishing business. This new branch would join in one structure Bibliopolis, the Gallimard CD-Rom activity and the travel guides catalogue, and was to be based in two major axis, literature and human sciences, on one hand, and travel guides, on the other and its ultimate goal was to create a literary portal with other independent editors. Bibliopolis presents four kind of services: a library that re-edits rare works and out of stock; Biblionet that allows the free reading of 101 classical texts; Lili, a free-access web site for high school teachers that has around 6 000 regular users; and a literary library that has a paid service for libraries and research centres of access to 3 000 works. It is also responsible for the digitalisation of the BNF (Bibliothque Nationale de France) catalogue. It would me a major chance for Gallimard to join the e-publishing business, but in July of that same year gave up from buying Bibliopolis. 3.3.4 - 00h00.com46 The creation of 00h00.com (pronounced: zro heure) in 1998, by Jean-Pierre Arbon and Bruno de S Moreira, gave birth to the age of the e-publishing as it was the first company in the world created for the publication on the Internet, with a commercial aim, of texts in digital format. It was also the first company to propose to the traditional agents of publishing (publishers and authors) the adventure of creating on the Net a new window of exploration for the author's rights. The publication of the titles is done through the drafting of distribution contracts with French and Portuguese publishing houses and the books to be sold on-line are selectively chosen by the editor itself, both on fiction and non-fiction domains. Each of the fields, classics from French literature, science fiction, sciences and human sciences, are grouped into collections that are co-ordinated by well-known experts in those areas. 00h00.com's catalogue is made of previously unpublished titles and of already published editions (rights or public domain) that can be bought in digital (pdf and rocket e-book), paper version or through POD (print-on-demand - Xerox's Docutech system that allows the printing of
46

http://www.00h00.com.

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the cover and the inside text) in case there is an unpublished or out-ofstock title. The great novelty then was that the consumer received the chosen text just a few minutes later after ordering it and at a cheaper price (less 40%) than the paper version available at bookshops. This meant a new format of reading and a new distribution channel that might lead to a new way of consuming. 00h00 can present the digital text in other formats like PalmPilot, SoftBook, Rocket-eBook, OEBS, etc, since the market for these tools is well developed. The reader is allowed to print the text for personal use. The web site has six sections: "Lectures", where the reader can find the titles published by 00h00 and available for sale; "Lecteurs", where the reader can participate in a discussion forum and have its own personal space; "Chez vous" allows him to create that personal space to where he can return to every time he visits the web site (through a password); "Recherche" gives direct access to the title the reader is looking for. The search can be done by title, author or genre; "Achats" indicates the situation of the reader's shopping basket and allows him to change the order, go ahead with it or cancel it. Nowadays, 00h00.com is a bilingual catalogue. Besides the French one, there is the Portuguese language that was presented at the 2000 edition of Salon du Livre de Paris and has authors like Jos Saramago, Nuno Jdice, Mrio de Carvalho, Daniel Sampaio, Mia Couto and Portuguese classical authors. It is a good way to overcome the traditional barrier of one-language localised catalogues and enlarging its range of clients, situation that was reinforced by the partnership between 00h00 and FNAC for 00h00's e-books to be sold in FNAC's web site. It was a step into a globalisation process that became more consolidated through the acquisition of 00h00.com, in September 2000, by Gemstar. On the other, as its catalogue is restrained in a global world to two specific languages, French and Portuguese, it is more specialised and focused towards a specific target audience taste. Its existence is valued for the pioneer attitude of its creation and for other initiatives like the one that took place in July 2000, the creation literary clips to promote the e-books it sells, as it is done in the music industry, showing the awareness of the possibilities and the need for a different kind of promotion strategy to sell digital products on-line. In terms of business model, however, there was no innovation, as it was and still is a distribution activity and non-self-publishing and its catalogue's dimension is quite small -500 titles.

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3.3.5 - Cytale47 Cytale, the only European prototype of an e-book container, is the symbol of the French and European technological development in the ereading area. On the Spring of 1998, J. Attali, Marc Vasseur and J. Lewiner partnered and decided to create the first European electronic book and a company, Cybook, was then created. More than an year later, in September 1999, 30 working prototypes were produced for marketing tests and on the following month the company took on a new name, becoming Cytale (cyber + tale). In March 2000, the first prototypes were presented to the press and to the general public during the 20th edition of Salon du Livre de Paris. Three months later, Cytale's visual identity was finally defined and its design finalised and at the end of that summer, the electronic book was officially presented at the NIST conference in Washington D.C. and its name unveiled: Cybook. Finally, in January 2001, after many delays due to technical reasons, it was launched into the French market48. Based on the promotional slogans of "Your personal library in only one volume"; "Read as you like"; "The pleasure of reading in all circumstances"; "Surf on the web at any time", the product has come out with some attractive characteristics. It can keep a considerable amount on information in it as it holds 16 MB of memory dedicated to content, which enables it to store approximately 15,000 pages of text or 30 books of 500 pages each. Several books can be opened at the same time and the reader can easily flip from one to the other, make personal annotations and even print them. It allows you a comfortable reading due to its format (20 x 26) similar to the one of a A4 paper sheet; its slim thickness (2,4 cm); light weight (900 gr.), and its easy-readable tactile, colour, LCD screen. The option of adjusting font size (choice between 3 to 7 different fonts and font sizes), the reading page by page and the use of hypertext links and easy commands makes it easy to use to the general public. And the download through a simple phone call by an integrated modem with a pre-configurated Internet connection makes the PC obsolete and not needed. To reach the highest possible number of readers, Cybook accepts any digital documents that conform to the Open E-Book standard or the
47 48

http://www.cytale.com. http://www.cytale.com/site/corporate/en/questions/questions.htm.

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HTML format. All works for sale on Cytale's web site will be formatted under the CytalePage format, which is 100% OEB-compliant and allows for a high-quality page layout, proof-read by professional typographers, whatever the choice of the type or size of the font. The catalogue first released included 1000 titles and it was anticipated that would be release 200 new ones per month. The type of titles available range from books and magazines to newspapers49, namely the Le Monde, and does not include only text books. For example, in association with Nestl, Cytale is able to offer to the future owners of Cybook a small, illustrated cookery book. In order to have content to offer to its clients, Cytale has drafted distribution contracts on a non-exclusive basis with several and quite different French publishers50, the majority from Hachette group. At Cytale's web site each reader can find the latest novelties, know more about an author, participate in a literary forum or read a review. It will do it easily from an electronic book as well as from a computer. The web site has the following sections: a selling point for the Cybook ("Boutique"), a bookshop ("Librairie") with a catalogue of digital works covering the whole publishing spectrum, a news stand ("Kiosque") dedicated to newspapers and magazines, and a library ("Bibliothque"), which will act as a personal account associated to each electronic book owner, and other services like chat rooms and e-mail accounts. Each electronic book is identified as property of a unique reader. At the time of purchase, the e-book container is already set up so that each customer can readily access his or her personal account. Through the use of a simple phone plug, the reader can connect his or her ebook to the Cytale online bookstore. The purchase and the download of the book are easy and simple. Downloading a long book takes less than 2 minutes on average. After the purchase, the book goes automatically into the personal library. When the reader is browsing through the catalogue, he can download purchased content from the library to the ebook container. And since purchased books have been acquired for life, readers can, at any time, download new books or swap content between the personal library based on the web site and the e-book.

49 50

Africultures, Alternatives conomiques, Le Particulier and Le Monde.

Actes Sud, Albin Michel, l'Archipel, Bayard, Bibliopolis, Le Cherche Midi, Fayard , Grasset, Hachette ducation, Hachette Littratures, Hatier, Imprimerie Nationale, Latts, Le Masque, Maxima, Presses du Management, Presses Universitaires de France, Rageot, Le Rocher, Le Seuil, Stock, 00H00 and Zulma.

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Even though Cytale's principle is simple - download and personal library -, the price, 5 700 FF, is not competitive when compared with the American machines like SoftBook and the Rocket eBook, its most direct rivals, whose price range from 2000 to 3 000 FF. The initial sales expectations, in 2000, were of selling 20 000 copies in France. When the launching was re-announced at the beginning of this year, the number raised to 40 000, what was and still is quite ambitious considering that it is a new object and has a quite high price. The difficulties in assembling the electronic components imported from Asia to produce the final object in France (Hitachi production) has lead to several delays in launching what has overshadowed the idea of pioneer. It was launched in January 2001, almost one year later than the initial date and with the idea of an European novelty already worn out. The policy of suggesting publishers to price e-books equally to the paper version is an error as part of the publishing chain and its costs are suppressed and a cheaper price could be an attraction to readers. Cybook can also be surpassed by more competitive machines capable of uniting in a single object the capability of presenting text, image and sound and that will not be exclusively dedicated to reading, like eBookMan. And still, it is too fragile to be handled by children in schools, for example. Not everything is that pessimistic. The presence among Cytale founders of well-known names of the French culture, like Jacques Attali and rik Orsenna, may give a hand to the promotion of Cytale in a country where "intelectual" culture has a decisive and traditional influence on the general public's choice of how to spend their leisure time. However, in other markets, this premise may not work out. The company, by October 2000, had gathered the support of 53 million francs from sponsors and partners (Sofinnova, Compagnie Financire Edmond de Rothschild Asset Management, Azo and Hypercompagnie) to develop the industrial production of its e-book, what shows the interest, belief and confidence of some important sponsors of the French industry in the project. The catalogue first released included 1000 titles plus 200 new ones by month, a modest ambition but still higher than the 00h00.com one and quite equivalent to the size of the French market when compared with the American one.

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3.3.6 - Penguin Penguin UK opened very recently, in September 2001, with the support of Lightning Source, a virtual bookshop, ePenguin51. The first 200 titles will include a wide-range choice, from Jane Austen's fiction to tourist guides, but Penguin hopes to publish through it first-hand novelties not being just an e-book distributor. The e-books will cost less 20% than the paper version and are to be read in desktops and laptop, but not yet in handheld devices, in MS Reader and Adobe Acrobat eBook Reader. It is too soon to elaborate any kind of analysis but has the advantage over the other presented business models of going over the distribution area by doing self-publishing. From the examples presented and considering that the e-books euphoria has cooled down, we cannot conform ourselves with the generalised radical idea of the US technological supremacy versus a public money-fed Europe. As we have seen, two major worldwide media groups that are investing in e-books and e-publishing are European based - Bertelsmann & Vivendi Universal. Smaller publishing groups like Penguin have joined in and ventures like 00h00.com, in the area of selling e-books, and Cytale, in the field of e-book containers, were pioneer and innovative, accordingly. The distance between European industry and the digital scene in the field of e-publishing is not that large and it holds promising seeds that threaten to spring. On the other hand, the successful development of global dimension groups like Bertelsmann and Vivendi Universal are an example of how Europe can compete with other media giants like AOL Time Warner or Viacom and have a significant role in the digital era that we are living.

3.4. USA Since 1998 that we hear speaking of e-books more consistently even though the concept was already used before, namely in the academic world. Since then, there have been several discussions over the issue of the effects of the possible success of e-books on the traditional paper book market. Dick Brass, Microsoft's vice-president, proclaimed in Ebook'99, that until 2020, at least 50% of the publishing
51

http://www.penguin.co.uk.

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market would be the electronic book and that paper would progressively die. It was the time, especially in the USA, of great euphoria around the "e-book" issue and that lasted until late 2000. Others just said no to the idea of the death of paper. Nowadays, in 2001, people are more cautious in their statements, perhaps influenced by the apprehensive attitude towards e-businesses. They now assume that, despite the on-going technological evolution, ebooks still have to go up a long walk to reach the paper properties that allow it to be a good reading medium. The American initiatives have played a major role in these discussions due to the importance of its innovative role and it is undeniable that one day the history of e-books and e-publishing cannot be done without such ventures. If we approach the subject from the American consumer habits' point of view, the USA has the perfect setting for the consumption of articles such as e-books or, one day, e-paper books. The traditional book industry has one of the most dynamic markets and the familiarity and usage of computers and Internet by the American people is quite consolidated. According to a report52 made, by the U.S. Department of Commerce through and presented by U.S. Census Bureau on September 2001, on home computers and Internet use in the U.S., numbers are quite consistent with the idea of a society quite familiarised with the new technologies. According to the report, in August 2001, 54 million of American households (51%) had one or more computers, up from the 42% in December 1998. In 2000, more than 4 out of 5 households with computers had, at least one member using the Internet at home, which accounts for 44 million households. In 1997 fewer than a half of the households with computers had someone who was able to go on-line. In 2000, 9 out of 10 school-age children (between 6 to 17 years old) had access to a computer, being that 4 out of 5 used it at school while 2 out of 3 at home. One of the general conclusions of the report is that "Since 1984, the country has experienced more than a five-fold increment in the proportion of households with computers. In addition, Internet use is rapidly becoming synonymous with computer availability."53 Such a consumer scenario is quite propitious for the development of any ecommerce activity and eventually to e-publishing ventures.

52 53

http://www.census.gov/population/www/socdemo/computer.html.

Eric Newburger, author of Home Computers and Internet Use in the United States: August 2000. Available in http://www.census.gov/Press-Release/www/2001/cb01-147.html.

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3.4.1 - Pioneer projects 3.4.1.1 - Project Gutenberg54 Project Gutenberg was created in 1971, by Michael Hart, who was given an operator's account with $100,000,000 of computer time in it by the operators of the Xerox Sigma V mainframe from the Materials Research Lab at the University of Illinois. With such opportunity in hand, he imagined that the greatest value created by computers would not be only computing, but the storage, retrieval, and searching of what was stored in libraries. From the digitalisation of the "Declaration of Independence" and sending it to everyone on the networks, he started a project based on the idea that anything that can be entered in a computer can be reproduced indefinitely, i.e., once a book or any other item (including pictures, sounds, and even 3-D items can be stored in a computer), then any number of copies can and will be available and each person, wherever it is, can have a copy of any book that it is stored in a computer. To this idea Michael Hart gave the name of "Replicator Technology" . For the project to work out, the electronic texts (Etexts) - the texts in digital format - were conceived to be available in the simplest, easiest and cheapest form to use. In this case, in "Plain Vanilla ASCII," meaning the low set of the American Standard Code for Information Interchange. It is the same kind of character one can read on a normal printed page, italics, underlines and bolds included. The goal is to have files that almost any hardware and software can process, read and search through and to have large portions of audience that will want and will use it frequently (read, use, quote, and search) and have the capability to do so, i.e. the average public. The choice of the texts to be made available stood, and still stands, on the same premises, even though it is planned that by the end of 2001 will be released many editions considered elitist, like Shakespeare and the other classics, for the comparative study on a scholarly level. From the light file (only 5K) of the U.S. Declaration of Independence, the Bill of Rights, the US Constitution, the Bible, Shakespeare plays, to the heavier files of general work in the areas of light and heavy literature and references, Project Gutenberg has made available countless free-copyright texts, like Alice in Wonderland or
54

http://promo.net/pg/.

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Peter Pan, hoping to reach 10,000 books on the Project Gutenberg Electronic Public Library by the end of 2001. Nowadays, the selection of Etexts to enter the Project Gutenberg Library is made based on three categories: light literature, with works like Alice in Wonderland, Through the Looking-Glass, Peter Pan and Aesop's Fables that aim to attract people to use computers; heavy literature, such as the Bible or other religious documents, Shakespeare, Moby Dick, Paradise Lost; and reference works like thesaurus, almanacs, encyclopedias, and dictionaries. It is its aim that also by the end of the year, a first 3D application of Replicator Technology will be functional to allow the download of pictures and images. The project deserves its credit for being "the pioneer project" in this area, specially because it is free-access and has no commercial aims and for its long-life fame that has been spreading since 1971 by word-of-mouth, or more accurately, by "word-of-network". Nowadays, it is possible to hear references to it in any regular conversation, movies, music, and even books. It is also the example of something that was born from the research, like PC or the networks, have but that has survived and developed itself without becoming profitable/commercial and standing as a free access database. 3.4.1.2 - University of Virginia Library Electronic Text Centre (Etext)55 The University of Virginia Library Electronic Text Centre (Etext), created in 1992, has two main goals. One is to build and maintain an internet-accessible collection of SGML texts and images. The second is to gather and enrich user communities that use of these materials and that contribute to its development. Its database contains around 51 000 on- and off-line digitised texts in twelve languages, in HTML and XML for downloading via the Internet, with more than 350,000 related images (book illustrations, covers, manuscripts, newspaper pages, page images of Special Collections books, museum objects, etc.), 5 000 of which are available for free for the general public. Collections The centre was created in order to take advantage of the combination of the emerging network - the Internet - and digitising technologies with its expertise and library skills. These skills, along with the training of users and the development of the collection itself, are
55

http://etext.lib.virginia.edu.

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considered vital, by its founders, for the maintenance of a vibrant electronic database. A library service offers hardware and software suitable for the creation and analysis of text and there are available permanent training sessions and support of teaching and research projects in order to build a diverse user community locally, serving thousands of users globally and providing a model for similar humanities computing enterprises at other institutions. The centre's database itself was built on the idea that a wellselected, reliable, integrated, catalogued, easy-searchable and easyaccess set of data is a unique way of attracting users. The attractive of highly-varied themes and genres of texts seems to have been also a concern for the centre as it has in its possession, as it was mentioned before, 51,000 texts, mostly online, including history, literature, philosophy, religion, history of science. Languages include Latin, Apache, Japanese, and Chinese among others. It has a very complete collection of Thomas Jefferson writings, one of the best collections of Mark Twain, the Booker and Nettleton collections. It covers most early American writers and from other nationalities (Mary Shelley, Charles Dickens, Jules Verne, William Shakespeare), other fields of Human Sciences (the American Civil War, African-American history and American Indian language and culture studies, collections in Medieval French and English poetry, illuminated manuscripts) and 21 editions of the Bible. This wide-range selection serves both University of Virginia users and Internet visitors. Users The majority of the centre's users are high school students and teachers from all over the world (around 190 countries) followed by the general public. User communities can benefit from training sessions that enable a rise of general capabilities to use the on-line resources and to develop individual research and teaching projects. On the other hand, as the provision of electronic materials is not enough in itself, more benefits to the collections come from the way users re-purpose the existing product and provide a high degree of critical observation on the various aspects of the digital library. According to data displayed on the centre's web site on the 11/09/0156, there are usually 30,000 daily visitor sessions from 20,000 unique host machines, accessing 130,000 documents per day (March 2001). In March 2001, there was an average of 5,930 daily visits to the physical libraries on Grounds, but 30,000 daily visits to the E-Text
56

http://etext.lib.virginia.edu/kwikfact.html.

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Centre. E-texts and e-books are the most used single library service. Its usage increased by 122% in the past year (2000-2001) to 4.3 million page accesses of e-texts in March 2001. 56% of the total library web traffic is to e-texts and e-text-supported projects, or about twice the average usage as VIRGO, the centre's online catalogue. The mostsought e-book is Aesop's Fables, registering more than 4 000 downloads. 3 million Microsoft Reader and Palm Pilot e-books were shipped in the period between 8th August 2000 and 15th June 2001 (an average of 9,470 per day): 1,600 titles, all in English; some illustrated. 18 000 students use the centre regularly. Access Whenever legally possible, the centre provides its users access to its browseable and searchable texts, but they do not have legal ability to provide general access to materials that are commercial publications. Those are supplied if paid for. Examples of it are the Chadwyck-Healey databases and the Oxford English Dictionary. All these commercial publications are available to University of Virginia users and around 8,000 titles are also licensed by VIVA (the Virtual Library of Virginia) consortium (39 state-assisted colleges and universities within Virginia). However, the thousands of texts and images that are publicly-accessible are not necessarily public domain so one cannot re-publish them without our permission. Standards SGML, EAD, TEI, TIFF formats allow everyone to create data in a fashion as standardised as possible. Tagged data that needs only ASCII to survive is central to the centre's digital library production because it networks well, is not beholden to any piece of software for its existence and it allows products from multiple sources to be accessed together through a common web-based interface. The use of SGML has assured that data is as usable and as malleable now as it was in 1992. The paucity of SGML software continues to be a burden, but texts have adapted quickly to the arrival of the web, to XML, and are now being rethought at the metadata level for full-scale cross-database searching. In an online library, data needs to be nimble to survive - it needs to be able to re-shape itself to take advantage of new display and layout possibilities, new and larger-scale searching and text analysis possibilities. The majority of the holdings are SGML encoded and Internet accessible through a common interface; other items are available on CD-ROM in the Centre.

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Areas of activity, research and partnerships The Etext Centre supports a variety of online journals, bibliographies, university papers and other publications and has developed since its foundation several areas of activity and research. Its main fields of research are the widespread searching across SGML and XML databases, as well as within them; the scanning of rare books (with the sponsorship of the Mellon Foundation); the XML-based Ebook technologies area for new ways to deliver our content; and the POD (Print-On-Demand) technologies. The centre has joined several partnerships in order to develop its projects, namely with special collections, museums, with faculty and student users from near and far, other libraries and archives. Among them are The Plymouth Colony Archive Project at the University of Virginia; Witchcraft in Salem Village, the Witchcraft Trials of 1692 (Ben Ray, University of Virginia Religious Studies Department); The Abraham Cowley Text and Image Archive (Dan Kinney, University of Virginia English Department); Lienu Zhuan (Anne Behnke Kinney, Associate Professor of Chinese, University of Virginia); Mark Twain in His Times (Stephen Railton, University of Virginia English Department); Thomas Jefferson on Politics & Government: Quotations from the Writings of Thomas Jefferson (Eyler Robert Coates, Sr.); Studies in Bibliography (Bibliographical Society of Virginia); Journal of Southern Religion; Arboretum Committee Minutes ; The Book Arts Press; and The Ford Foundation (a web site built by IATH with document conversion skills (Quark to SGML) and filtering (SGML to HTML) by the Etext Center). The combined service of free-access and commercial activities in this project and the development of research in that area gives it an unique feature by combining two different approaches to e-publishing that are usually seen as separate realities, commercial and noncommercial. The idea of building and maintaining an internet-accessible, standardised collection of SGML texts and images that also allows crossdatabase access was made possible by the well-done combination of the potential of the Internet, the digitising technologies and the traditional library skills and with the help of well-formed communities of users. This helped to develop the up to now hidden possibilities that the physical databases could not offer, namely a 24-hour consulting period, from any point of the Earth or, who knows, from outer-space via satellite connection, in a more selective and quicker way. These characteristics

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enriched the project and gave it a high quality and consistency status that Project Gutenberg does not possess. The whole system gives the possibility of doing its own selfpromotion as it leads to the attraction of more readers to library consulting. Because nothing brings people back to an on-line service like a well selected, reliable, integrated and catalogued set of data, especially if it is searchable and can be delivered quickly through a common interface. The wide variety of themes, collections and areas of study along with the availability of a great number (51 000 on- and offline digitised texts from 12 different languages) of interesting texts to the reader enabled by the uncountable partnerships certainly gives a hand. The project also helps to re-articulate the social, pedagogical and intellectual roles of the library, namely by building and maintaining user communities that will contribute to the modelling of the database and that are encouraged to develop individual projects. Projects like Gutenberg and the University of Virginia eText Centre raise a sensitive issue to some publishers. If institutions like universities and foundations can offer free copies of books whose rights are already under public domain, what will happen to the sales of classics, namely those that integrate the national educational programs? As we know, this kind of books represent a quite significant percentage in the sales revenues of some publishers, namely for Penguin and Wordsworth and it is possible that they may have to rethink their strategy regarding the literature classics. On the other hand, will students read this kind of books in digital format? The newest generations are more close to computers than adults but, still, it is a computer, an e-container or a PDA screen in which reading is not comfortable. It is quite early to know the effects. 3.4.1.3. Stephen King, the lonely semi-commercial pioneer On the Spring of 2000, Stephen King and its publishing house, Simon & Schuster, decided to publish in digital format exclusively the 66-page e-book novella, Riding the Bullet, for a price of USD 2,50. It was the first time a major author distributed a book only in digital format. It sold over 400,000 copies in the first 24 hours and was cracked by hackers two days after its on-line launching. Nonetheless, it was a huge success and it created a splash in the distribution system of the publishing industry. As Jack Romanos, President and Chief Operating Officer of Simon & Schuster, pointed out at the beginning of

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the introduction text to the first e-book list from Simon & Schuster (Fall 2000), Stephen King's Riding the Bullet was the "opening salvo in the eBook revolution". Since Riding the Bullet, intrigued by the success of this venture, Stephen King was eager to try something similar without the aid of his publishers. Commenting on issues of ownership when it comes to creative work on the Net, King confessed being puzzled by, but applauding, Metallica's decision to "try and put a few spikes into the big, cushy radial tire that is Napster." Creative people should be paid for their work, King defends, just as plumbers and carpenters and accountants are paid for theirs. On June 2000, King then proposed fans pay $1, if they wished, for the unencrypted instalment (open PDF format) of each chapter (printable, this time) of The Plant, an unfinished epistolary novel he started in the 80's but that gave up upon and kept closed in a drawer for years. The chapters would be progressively available on his web site57 but he warned that he would cease publication if too many people steal the story. The pay-through of the first chapter exceeded 75%, as King asked his readers, amounting to 150 000 downloads in the first seven days. However, numbers progressively decreased and by the sixth chapter the payments were only of 46% and he decided to gave up the venture. According to an independent poll conducted last week by The Book Report Network58, most e-books were downloaded but not read. While 5% of the survey respondents said they bought Stephen King's ebook, Riding the Bullet, less than 1% claimed to have actually read it. "Few if any have bought any other e-books. The attraction was Stephen King, not the e-book format,"59 said Carol Fitzgerald, The Book Report Network CEO and founder. Despite its failure, both ventures led by Stephen King raised some important issues, namely, the one of self-publishing. Can the Internet liberate authors from their dependence on publishers? Besides Stephen King, who will have the fame and the ability to attract so many readers in such a miscellaneous and overcrowded text world such as the Internet? A new concept of publishing was introduced as the work does not have necessarily to be finished to be published. It can be a work-inprogress, what is also a new reality in copyright law. The fact of giving an unencrypted file brought the shareware concept that we knew from software into the book market.
57 58 59

http://www.stephenking.com. http://www.wired.com/news/print/0,1294,35722,00.html. Idem.

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However, other issues stood behind the failure of Stephen King's second adventure, which are the unanswered question whether people pay for something on the web and the importance of a well structured promotional campaign to ensure the success of following chapters or books. Nonetheless, others, like Frederick Forsyth and Fay Weldon, followed his lead and Stephen King will stay in e-book and e-publishing history has the author who put out the first mass-market e-book and defied the publishing industry rules through self-publishing. Seth Godin was another example, though more successful. In July 2000, six weeks before releasing the hardcover, he offered the e-book version of Unleashing the Idea Virus for free from his web site60. It was the first New York Times best-seller to be released in its entirety as a free e-book online. Godin expected that many people who read at least a portion of the book for free online would purchase the hardcover and it seemed to have worked out. Critics said that giving an e-book away would inhibit sales of the hardcover. After 250 000 downloads of the ebook for free, more than 100,000 people asked for a sample. Later, by the time the paper back version was to be issued, he sent an e-mail sent to more than 10,000 people where he announced that there was a secret e-mail address written on page 82 of 10 different copies of the paperback. This lead to a rush for the book. Nowadays, there are more than 1 million downloads and pass-alongs of the free e-book. Unleashing the Idea Virus is translated into 10 languages, being # 5 on the Amazon best-seller list and # 4 in Japan. Godin did unleash his idea-virus and showed that this trend may be a way of promoting ebooks on the Internet. 3.4.2. - Commercial ventures 3.4.2.1 - AOL Time Warner In January 2000, the acquisition of Time Warner by AOL created a communications mammoth, a delivery infrastructure based on Time Warner's U.S. cable network (Time Warner Cable) and AOL's capability of reaching, through the Internet subscriptions, 33 million homes worldwide. The aim was to use these digital tubes to sell the news and entertainment content of Time Inc. magazine group (Time, Fortune, among several others) and the music (Warner Music Group), film
60

http://www.ideavirus.com.

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(Warner Bros., New Line Cinema), book (Warner Books) and TV libraries (CNN) of the Warner group. Since then, the new group has been investing in the distribution of contents via Internet, namely in the publishing area. In May 2000, Time Warner started its own electronic publishing unit, iPublish.com, and in the following Summer, after Random House announcing the setting up of an e-books list, iPublish released its own list of electronic originals and other e-book editions that would be available, simultaneously, in e-book format, in POD print editions and on the bookshops. Like many other commercial e-book distribution ventures, the initial 24 titles presented included a variety of commercial, business, popular science and literary writers such as David Baldacci, so that iPublish could figure out what might sell better and if the best-seller tendencies would apply to e-publishing. The advantageous difference was that books' prices ranged from $ 4.95 to $ 14.95, the prices of paperback editions. The results of the venture have shown moderate when compared with initial optimistic perspective. More recently, iPublish created an on-line community of writers, called iWrite, that receives and evaluates manuscripts and develops new writers using the Internet. In October 2001, iPublish began offering for sale the first three books to be developed from the web site's on-line writers' community. The contract established with these first-time writers grants iPublish the exclusive rights for 90 days while the work is being evaluated by site members and iPublish editors. The best quality works are acquired and first released as e-books and, afterwards, if popular, as a front list print edition. 3.4.2.2 - Viacom61 Viacom is another major media group of the American scene that owns interests in television (CBS, MTV), in cinema (Paramount Pictures), video distribution (Blockbuster) and books (Simon & Schuster). Viacom, despite of not having any direct link to the Internet business world, it has decided last year to enter the e-publishing adventure. In July 2000, its American publishing group, Simon & Schuster USA, announced62 an alliance with Lightning Source, the
61 62

http://www.simonsays.com/ebooks. FELDMAN, Gayle, "E-fulfilment deal for S&S, Lightning Source" in The Bookseller, 14/07/2000, page 10.

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Ingram Industries subsidiary, in order to exploit the digitalisation, ebooks and print-on-demand markets. Simon & Schuster had, at the time, a backlist of 12 000 titles and a publication rhythm of new 2000 titles per year. On the first stage of the operation, 6 000 titles of the backlist were digitised. Simon & Schuster's aim was to streamline the whole process of selling e-books to other companies, so, instead of spending time delivering seven different titles to seven different ecompanies, S&S goes through Lightning Source and others can get our titles through this company like what happens in the print world. Unlike Random House and Time Warner, S&S did not create any imprint to publish their electronic books but, due to its lack of experience in the Internet world, made an alliance, as mentioned before, with Lightning Source, a digital book distributor, to sell its e-books. In August 2000, S&S presented the first list of e-books to be available in 2000's Fall. By this mean, it become the third major trade publisher in the area, after Random House (Bertelsmann) and Time Warner's trade publishing division. This list included not only titles that were sold also in paper, but also some books to be sold exclusively on digital form. The titles selected ranged through fiction, popular culture, business, health, children's non-fiction books, educational reference and games63, but were clearly chosen to capitalise on the potential for marketing to groups active on the Internet, like fans of "The Blair Witch Project" or "Star Treck". It showed a strategy that would go beyond a simple digitalisation of contents and the conscience that not all kind of books will have the same success in the e-book format. It implied that each title should be marketed for each specific public, specially the ones related with the Internet, and the wide variety of titles also showed that they were ready to give it a try to several genres and see how it worked out. The list included books from the several specialised imprints of S&S. However, even though initially the prices for books sold solely in electronic form ranged from $5 to $15, the others would have the same price as their hardcover versions and, so did not have the attractive added-value of a less expensive price for the reader. 3.4.2.3. Random House (Bertelsmann)

Exclusive digital versions release: Wall Street Journal e-books (a series of books from the business journal), Blair Witch: Grave Yard (about the hit movie), Star Trek titles. Simultaneous release: On Writing, by Stephen King; Screwjack (a collection of stories to be released serially as a preview to the publication of the paper version), by Hunter S. Thompson; Perfect Recall (a previously unpublished short story), by Ann Beattie; President George W. Bush or President Albert Gore Jr. (a children's book biography of both candidates); and other titles by Stephen Ambrose, Bob Woodward, Jesse Ventura and Jimmy Carter.
63

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On April 2000, Random House Inc., one of Bertelsmann's publishing groups, became the first publishing house of its kind to own a large participation of an electronic publisher by acquiring, through Random House Ventures, the company's new subsidiary specialised in electronic initiatives, 49% of the on-demand and e-publisher Xlibris. The aim of this acquisition was not to open a gateway for Random House to obtain and publish Xlibris content, nor for Xlibris to serve as an electronic subsidiary of a traditional publisher. The goal was to take the maximum advantage of Xlibris' experience and knowledge but to use it in a different perspective. More, the Xlibris self-publishing service would be another source of new authors and almost production costless as it would not carry with it the costs of pre-production printing. An operation similar to the one developed between Simon & Schuster and Lightning Source, i.e., a distribution deal with a company expert on e-business, but with the difference that Xlibris also includes among its activities selfpublishing. Later, in July 2000, Random house reinforced its role in the epublishing business by creating an electronic imprint called @Random (AtRandom) that would start publishing titles early in 2001. It was decided that AtRandom would not be working with Xlibris, for both companies have quite distinct lists. This Random House move came just a week after Stephen King broke new electronic ground by offering online instalments of The Plant directly to his readers through his web site for $1 only. Through AtRandom books would be sold on-line as digital books or in single on-demand printed copies. The original project was to set up a "Modern Library" of electronic books by publishing in digital format one hundred works of classical literature from Random House's backlist, like James Joyce's Ulysses, or E.L. Doctorow's Ragtime, and to edit 20 original works of prominent authors that would be sold exclusively online, not available on bookshops. The original works to be published were chosen by its small size, from 100 to 200 pages, with more difficulties to be sold in bookshops and with easier reading on the screen than bigger books. Its themes, namely the 3 biographies (from Bjork, Richard Stallman and Alan Greenspan) and two works from well-known American journalists to be published are titles that would easily call the attention of readers already familiarised with the Internet and avid consumers of the generation of new media. At the time, authors were due to receive advances and would earn 15% royalties, the conditions of standard Random House contract for the traditional market.

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Hardcover 1st edition 10%

Hardcover subsequent editions 15%

Paperback 7,5%

By the end of 2000 (November), however, Random House changed royalties' policy by announcing that from now on it would offer authors an even split (50%/50%) on the electronic book sales revenue. This intended to put an end to the crescent price and royalties war and it overthrew its initial decision of giving the traditional 15% royalty rate. This was allowed by the absence of costs of paper, printing presses, warehousing, shelf space and inventory management, even though the investment in technology to build a digital infrastructure to deliver ebooks was quite high. It was also a way to convince authors to join a venture that was considered polemic due to the security and copyright infringement issues. On the other hand, other e-booksellers continued to keep about half of an electronic book's retail price. This split was reasonable as the electronic publishing, as it involved the sale of pure content without paper and production costs, resembled and still resembles more a licensing agreement than a cession of rights for publication. By March 2001 Random House had around 300 titles in e-book format. And within a year hopes to have more 1 000 front-list titles to sell in this format. Random House had invested so far more than 5 million USD to develop its e-book publishing program and planned to invest about 10 million over the following three years. However, in June, AtRandom took a turn towards traditional print. The idea of early and exclusive e-publication was gone from the project for all the books are now simultaneously released as both e-books and trade paperbacks. The idea of selling books with a smaller quantity of pages, less than 200 pages, is now also gone and along with it the length requirement. Random House has stood out for its double strategy, i.e., of betting in an independent e-distributor and e-publisher, Xlibris, and, at the same time, creating its own e-publishing imprint, AtRandom. It was, in a certain way, an attempt to experience two different kinds of business models and to see how they succeeded. The innovation element on the royalties' issue was a major step in the settlement of its position in the publishing market as it is a measure that would attract apprehensive authors into the venture and an attempt to solve a long war with authors' agents.

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3.4.2.4. Barnes & Noble - bookshop The American market did not see only publishing houses trying on their luck on the e-book business. In the beginning of 1999, Barnes & Noble, the first American on-line bookshop, tried to buy Ingram, the most important American retail group who owns Lightning Press, the pioneer of the POD in the USA, but the operation was refused by the American government for it meant an abuse of a dominant market position. This led to the development of an independent project rival to the Lightning's one, in which the POD system is directly integrated in the B&N's web site. At the end of that year, Barnes & Noble became eprinter through a partnership with IBM64 for the creation of POD web sites. Unlike its eternal rival, Amazon.com, that has become more and more like a multi-product bazaar, B&N has been concentrating more and more on its core activity, books, but enlarging the sub-activities that may come out of it. Its goals were to create five web sites, two delocalisated ones, in Central America and the other in Asia, both dedicated to the scanning and OCR65 operations. The other three, USAbased, would "print" with the help of IBM technology (IBM InfoPrint 4000). This was the follow-up to a mutual project that included a pilot group of 5 publishers on a plan to bring full range of digital services to the publishing world in January 2000. In that same month it was announced a partnership with Microsoft for the development of and electronic bookshop that would use Microsoft Reader software. This would fill in the other business area, the commercialisation of e-books. The operation really took off on August 2000 with the launching of BN e-bookstore that offers free downloads of Microsoft Reader software (www.microsoft.com/reader or http://ebooks.barnesandnoble.com) and an inventory of 2 000 titles, including 100 classics available for free. The store adds 150 new titles every week. However the Microsoft/BN deal was made on a nonexclusive basis, for B&N offers also a choice of MS Reader, Rocket eBook and Glassbook formats and Microsoft will also distribute software and e-books through other retailers. To expand its variety of content, B&N has bought 49% of the online publisher iUniverse.com (January 2000) and a 25% stake in the eB&N, even though it belongs 50% to Bertelsmann preferred IBM technology whilst Bertelsmann has adopted Xerox technology for its web sites.
64 65

OCR - optical recognition system that allows the recuperation of texts scanned from books.

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publishing web site MightyWords.com (June 2000), a company that was created by the on-line computer book retailer FatBrain.com, that was later bought, on September 2000, by B&N. MightyWords uses B&N.com to distribute its digital inventory of downloadable (for Glassbook or MS Reader format for handheld or desktop devices) and printable (Glassbook version) form texts and this content is integrated in B&N database. Like Bol.com launch its web book TV, in July 2000 B&N launched Barnes & Noble TV, which broadcasts over the Internet, featuring short, book-oriented programs that allow viewers to purchase books. The first TV programs were three-minute films called book videos with daily author interviews. Like Random House, B&N also set, in the beginning of this year, a new royalty rate intended to attract authors to publish their works in digital format. But, unlike Random House, B&N is trying to cut out the publisher by acquiring rights directly from authors and releasing their own labelled electronic books. With this strategy, B&N makes its move into the battle between publishers and booksellers over the ground rules of the electronic book business. By paying a royalty rate of 35% of a book's list price on e-books sold through its web site, B&N overthrows the previous benchmark of 25% once set by Random House. On sales of its electronic books through other retailers, B&N will split its wholesale revenue 50-50 with authors and agents, matching Random House's terms. B&N also competes with traditional publishers (printed book) by charging lower prices than some other publishers have announced. The prices range from $5.95 to $7.95 for electronic versions. It is a step towards becoming a general trade market publisher, which is by itself, a quite ambitious plan. B&N can market without much difficulty its electronic titles to its six million customers. It has the technology, the customers, the web site and the traffic66. And it congregates the idea of having a specific activity - books - with the means to make it work by offering its authors the technology, the retail web site and the customer database. B&N is, when compared with the other study cases presented, the company that seeks to have a more complete business model by trying to explore all the fields of e-publishing, as an e-printer (POD), epublisher and e-distributor (congregation of contents: its own, Mightywords.com and iUniverse.com), the distribution means (Internet
On September 2000, B&N became the bookseller of Yahoo portal, leaving Yahoo's former associate for that area, Amazon.com, behind.
66

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traffic rates and high number of subscribers to its services). As it was told before, it is a quite ambitious plan and it will only workout if the coordination of synergies between all areas is granted. Like on the other cases presented the price, the royalties and the promotion issues are carefully addressed and considered crucial to the success of the ventures. As we have seen, the American industry has lead a determinant role in the e-books history since its initial euphoria to its present day scepticism. Pioneer initiatives like Project Gutenberg and The University of Virginia Library Electronic Text Centre have shown how can noncommercial projects can be successful and do give their contribution to the dissemination of works and knowledge among us. On the other hand, the strong investment of American publishers (Warner Books, Simon & Schuster and Random House USA) and booksellers (Barnes & Noble) in this area and the creation of such different insights (e-publisher, e-distributor, content providers and content promoters) and of such varied business models in this field, show how fruitful has been the development of the e-publishing business in the United States. Another significant example of this agents' commitment is the way how important questions like authors' royalties, book prices, promotion and business models have been addressed and re-thought in a new reality outside the world of the traditional book market. 3.5. Global Market Tendencies 29 In the last two decades, major media groups have spread their arms across continents and seas and watched their businesses reach a global dimension. The path set by phone, radio communications and TV broadcasting that allowed Man to know what was happening on the other side of the planet in a few minutes was transfigured by the birth of the Internet. Not only information travelled at the speed of light as it finally could be transported in any format (text, image, sound and video) and any quantity through only one channel. These groups have either concentrated their activities on content (like films, books or music) or on distribution (Internet, cable and satellite systems). But, since AOL's acquisition of Time Warner that the future seems to belong to those who own both and who manage to

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spread this concept around the globe. In the publishing business this has lead to a true revolution whose main feature is the emerging market of e-books and e-publishing where synergies seem to gather and roles start to change. Publishers, distributors, authors, booksellers see their roles being interchanged: authors are becoming e-publishers, booksellers are now e-publishers and e-printers and some publishers are turning to e-distribution. This means the democratisation of publishing and a more vibrant marketplace and nothing at all about killing the market for printed books. It means expanding the book to other new market areas. As we have seen, publishers, distributors, libraries, authors, booksellers have started their e-publishing ventures and they have approached the subject in various ways, with different business models, all over the world. They tried what they did not know about - new ways of selling, distributing, promoting, of paying rights and even of making their accountability. In the beginning of the thesis, I raised the question whether there are several different regional business models, like, for instance, an European one and an American one, among others. The changes brought by the digital format to the roles of the agents of the printed book market are setting new business models, but none of them seem to be characteristic of any particular world region, be it Europe, the United States or Japan. And, still, they are business models in development and it is too soon to recruit them to management books as examples to be followed. In fact, to match the initial e-book euphoria (1998-2000) comes now a more apprehensive, adult perspective reinforced by the e-businesses bumps of 2001, especially in the stock markets all over the world. However, what has been developed both in Europe and America in this field cannot and will not be put aside or forgotten. The re-invention of a whole business chain has started. The e-book or the POD system may not revolutionise the way we read, but they surely have given a good hand in a revolution of the publishing business that is integrated in a more broad size revolution, the digital revolution and the way it affects our relationship with what surround us. This year's bumps, however, cannot be that chaotically destructive. It is a reality that most e-business that shone in the period between 1998 and 2000 breathed artificially thanks to stock market euphoria and it was also that made them crash into the ground. However, it is a fact, that people relationship with computers and Internet usage is growing

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everyday more and more consolidated, especially in the United States and, progressively, in Europe. It is also true American economy has been showing signs of recession for some time and that the true economical consequences of the events of the 11th September are, at the moment, hardly predictable. But, still, Internet usage habits are growing more and more solid in every area of everyday life even if an economical crisis might be approaching.

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4. NEW OBJECTS Communication's evolution usually brings with it, in each new phase, new objects as well as the market ventures. These objects nowadays can have a physical existence or a virtual one. This may seem contradictory with the commonly known concept of object (an artifact), as it is something created by Man (technology) and whose essence is physical. However, in the last decades, we have watched the appearance of technological tools that do not possess a physical nature. An illustrative example is software tools that are inside an object, the computer, but that do not have a physical existence. The changes that have been happening in books and publishing have originated and are still originating and developing new objects. The goal in this chapter is to try to depict the most representative new objects and tools related with the new communicational model and to see how they may affect our life. It is also its intention to see if, despite the major investments from several big world editorial groups in this new market, in the last three years, the existing technology is still very far ahead of demand. 4.1. E-Ink and e-paper: the future? To touch, to see, to smell the paper of a printed book is a timeless experience that the e-book cannot replace. For centuries, paper has been the perfect medium for exchanging information but printed words cannot be changed. However, as it was already pointed out before, epaper seems to be a promising alternative to traditional paper as it may develop and improve the characteristics that make paper an ideal support to write and read text. Being a dynamic high-resolution electronic display that is thin and flexible, e-paper can, if coupled with broadband communications, allow readers to access information without any time and distance constraints. E-paper (also known as electronic paper, radio paper or electronic ink) is a portable, reusable storage and display medium that looks like paper but can be, like a palimpsest, be re-written upon, by electronic means, thousands or millions of times. E-paper, which is still in a development phase, may be, in a near future, used for applications such as e-books, e-newspapers, portable signs, foldable, wall-size displays, next generation displays in mobile telecommunications devices and PDAs and, eventually, paper-thick televisions. The information to be

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displayed is downloaded through a connection to a computer or a cell phone, or created with mechanical tools such as an electronic "pencil". At this stage, there are a number of different technologies being developed: Xerox, in partnership with 3M, has created an e-paper called Gyricon and E Ink, with the sponsorship of several companies, like Lucent, is working on a device also known as E Ink. 4.1.1. e Ink67

view of e-Ink through microscope

How did it begin? "Books with printed pages are unique in that they embody the simultaneous, high-resolution display of hundreds of pages of information. The representation of information on a large number of physical pages, which may be physically turned and written on, constitutes a highly preferred means of information interaction. An obvious disadvantage of the printed page, however, is its immutability once typeset. We are currently developing electronically addressable paper-page displays that use real paper substrates. This effort includes the development of novel electronically addressable contrast media, microencapsulation chemistry, and desktop printing technologies to print functional circuits, logic, and display elements on paper or paperlike substrates, including interconnecting vias and multi-layer logic. Electronic ink is a new material that will have far-reaching impact on how society receives its information."68
Dr. Joseph M. Jacobson Barrett Comiskey Patrick Anderson
67 68

http://www.eink.com. http://www.media.mit.edu/micromedia/elecpaper.html.

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Leila Hasan

The pioneering research into electronic ink and the technology that powers it was conducted at the MIT Media Lab, Dr. Joseph M. Jacobson, Barrett Comiskey, Patrick Anderson and Leila Hasan. From this research born an independent company called E Ink that has been developing the device and the technology behind it for commercial purposes. The company E Ink Corporation, headquartered in Cambridge, Massachusetts, was founded in 1997. Its investors include major corporations (technology companies, publishers and venture capitalists) from several countries like Cabot Corporation, CNI Ventures (Gannett Co.), Creavis GmbH, Gruppo Espresso, Havas, Hearst Corporation, Interpublic Group, Lucent Technologies, The McClatchy Company, Motorola, Philips Components, TOPPAN Printing Company Ltd. and Veba. Such a variety of investors shows the extent of the possible future applications of e Ink technology and the confidence of investors in the project. The amount of money for investment gathered since its creation. To date, it has raised over $70 million, $15.8 million in its first equity round made in 1998 and $37.1 million on a second round (2000). More recently, in February 2001, Philips Components joined in with a $7.5 million investment as part of a joint development for the use of electronic ink in handheld device displays. How does it work?

Electronic ink is the result of a fusion of chemistry, physics and electronics. Its principal components are millions of tiny microcapsules, about the diameter of a human hair. In one incarnation, each microcapsule contains positively charged white particles and negatively charged black particles suspended in a liquid "carrier medium". When a negative electric field is applied, the white particles move to the top of

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the microcapsule where they become visible to the user. This makes the surface appear white at that spot. At the same time, an opposite electric field pulls the black particles to the bottom of the microcapsules where they are hidden. By reversing this process, the black particles appear at the top of the capsule, which now makes the surface appear dark at that spot. Through the alternation of microcapsules differently charged can be created black and white text and images. To form an E Ink electronic display, the ink is printed onto a sheet of plastic film that is laminated to a layer of circuitry. The circuitry forms a pattern of smart pixels that can then be controlled by a display driver. The information to be displayed is downloaded through a connection to a computer or a cell phone, or created with mechanical tools such as an electronic "pencil," and remains fixed until another charge is applied to change it. The film can be printed, using existing screen printing processes, onto virtually any surface, including glass, plastic, fabric and even paper and it has been used for retail signs. Characteristics The e-ink enables the display to have some paper-like qualities and others that improve the concept of the traditional paper and that are useful for the reading activity: Exceptional brightness and contrast under a wide range of lighting conditions. 30 Easy viewing from all angles. Low power consumption as it displays an image even when the power is turned off. The prototypes of the device have been running on watch batteries. Thin, lightweight form. Electrically writeable and erasable and it can be re-used 1000s of times. Electronic ink can be printed on almost any surface, from plastic to metal to paper. And it can be coated over large areas cheaply. By allowing any surface to become a display, it brings information out of the confines of traditional devices and into the world around us.

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Electronic ink products are redefining how information is displayed as information that was once static can now be dynamic and it will be no longer confined to rigid flat glass screens. Products Nowadays, E Ink is being developed in three different ways: The Ink-In-Motion Electronic Signage that can make any product stand out in busy merchandising retail environments. The use in personal devices, as liquid crystal displays are limit as an interface for mobile devices, as they draw too E Ink displays deliver the readability of paper under conditions, without the need of backlighting and have consumption rate. reaching their much energy. virtually any a low energy

The use of e-paper in publishing, namely in books as, like traditional paper, it presents an outstanding contrast and readability, it is inexpensive, highly portable and it requires no power and overcomes it by turning the word into something changeable unlike the printed word. E Ink announced that this technology may be available within five years. 4.1.2. Xerox69 How did it begin? Xerox, who has run a long path in the computer world evolution and does not need any introduction as a company, has developed several web publishing solutions, namely in the area of print-ondemand, authors' rights management and in the research of e-paper. The electronic reusable paper uses a display technology, invented by Nick Sheridon, at the Xerox Palo Alto Research Center (PARC), called "Gyricon" and it is very similar to the technology used by E ink. The partnership with 3M allows Xerox to have its product manufactured in large quantities, enough for commercial applications. Xerox PARC says that the material may be available next year. How does it work?

69

http://www.parc.xerox.com/dhl/projects/gyricon/.

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A Gyricon sheet is a thin layer of transparent plastic in which millions of small beads are randomly dispersed. The beads, each contained in an oil-filled cavity, are free to rotate within those cavities. The beads are "bichromal," with hemispheres of two contrasting colours (e.g.black and white, red and white), and charged so they exhibit an electrical dipole. When voltage is applied to the surface of the sheet, the beads rotate to present one coloured side to the viewer. Voltages can be applied to the surface to create images such as text and pictures. The image will persist until new voltage patterns are applied. There are many ways an image can be created in electronic reusable paper. For example, sheets can be fed into printer-like devices that will erase old images and create new images. For applications requiring rapid and direct electronic update, the Gyricon material might be packaged with a simple electrode structure on the surface and used like a traditional display. An electronic reusable paper display can be very thin and flexible, enough so that a collection of these displays can be bound into an electronic book. With the appropriate electronics stored in the spine of the book, pages could be updated at will to display different content. Characteristics Exceptional brightness and contrast under a wide range of lighting conditions. Easy viewing from all angles. Low power consumption as it displays an image even when the power is turned off. The prototypes of the device have been running on watch batteries. Thin, lightweight and flexible form. Electrically writeable and erasable and it can be re-used 1000s of times. Electronic ink can be printed on almost any surface, from plastic to metal to paper. And it can be coated over large areas cheaply. By allowing any surface to become a display, it brings information out of the confines of traditional devices and into the world around us. Relatively inexpensive.

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Philips is also working on a type of e-paper that will be full-colour, but that it is, according to the company's expectations, at least 10-15 years away. On the introduction of the thesis, among several questions, I asked whether, despite the major investments from several big world editorial groups in the e-books market, in the last three years, the existing technology is still very far ahead of demand? I think that it is because, as I told before, e-books even if they opened the way for a new era in publishing, they are not, in their present form, revolutionary from the communicational point of view nor are they adapted yet to the process of reading. E-paper or e-ink, however, by conserving and "expanding" the traditional paper's qualities and by offering extra-values like the infinite writing/erasability ability and, one day, the capacity to contain the text and images of more than one book, may lead to the creation of a new communication model, a new tool or object in the sense that I defined earlier. 4.2. PRINT-ON-DEMAND Book-on-demand or print-on-demand (POD) is the way of ordering through the Internet books that will be printed, on the moment, according to the order received and promptly sent to the client. Since the creation of POD web sites, the relationship between publishers and printers has gradually changed, as well as the distribution concept we knew up to know. POD is a revolutionary step in the publishing industry, but not in the communicational model that the book represents, as the final products of a POD operation is a paper book as we know it for decades. POD makes small print-runs commercially viable, not risky and easily printed, namely in the academic publishing where print-runs rarely go over 1000 copies. The most recent generation of POD machines can produce from 900 to 1000 pages per minute and allow the subdivision of print-runs up to 100 copies each, suiting better than ever the specific needs of the market. POD rapidly caters for the out-of-stock situations because books are always available on digital file and allows old and rare books to return to the market. Digital files of books can be sent electronically, stored in digital "warehouses" as close to the customer as feasible and printed, one at a time, as they are ordered by the customer. Still, the investments are quite high to small companies and only small print-runs bring profit,

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but, in the end, the costs lower considerably, especially in shipping, handling and warehouse. The size of inventories and the associated carrying costs are also reduced and the publisher's cash flow is improved because it is less tied up in inventory. POD is a practical and economical way of making available a large number of titles and of satisfying the customer needs anywhere in the world and taking a shorter period of time. It also reduces the financial risk of keeping a title in print and enables a publisher to bring back to life out-of-print and back list titles, test new titles on the market and avoid overstocks. Shortly, POD provides the opportunity for a more efficient value chain and distribution network and reduces the high costs that restrict the access of consumers to low-volume content. POD has also revolutionised the well-defined functions within the publishing industry. With such system implanted in its web site, a publisher, a bookseller or even an author can become printers and give the client the book in the format and style he desires. The printers can now respond more promptly to its customers' demands and even become publishers. The alliance of the POD and the Internet will allow the creation of virtual bookshops capable of answering the most specific needs of clients. How does it work? Publishers provide a book, in electronic format or hardcopy, and pay a fee to a POD company. If the text is delivered as a hard copy, the text is scanned and paginated to look exactly as the original, i.e., it should have crisp text, clean graphics and a four-colour cover. Electronic files are set up according to the specifications of the publisher and a proof copy is printed and compared with the original. After approval, the file enters a digital library where it is stored and becomes available through all the big retail channels, including virtual bookshops like Amazon.com. However, the distribution can be done in three different ways: a) Print and distribute at the wholesaler - when a bookseller or library places an order with an wholesaler (big distributor), the wholesaler sends the order to the POD company, which prints the book(s) and has them ready within 48 hours. The wholesaler then ships them to the bookseller or the library, following the traditional distribution chain.

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b) Print and ship directly to the consumer - the POD printer, that can be, i.g., a publisher, can print and deliver directly the book ordered to the customer according to the special requirements he asked for, without having to go through the traditional distribution net. c) Print at the retailer - the publisher will set up the title in the library of a digital distributor and when a customer orders a book at the retailer, it will be printed and bound in the retailer store. This is the less common practice because it has not been proved viable and profitable. 4.2.1. The hardware suppliers The POD field is being developed and explored by two main world companies whose range cover the entire planet: Xerox and IBM. 4.2.1.1. Xerox70 Xerox has developed over the years several solutions for the reproduction of text printed in paper. Is there someone in our planet that has not used a xerox copy machine? Among its research areas in the last decade of the XX century was the printing of books. The first Docu Tech machine was launched in 1991 and it was nothing more than a super photocopy machine manufactured for big companies that produced voluminous annual reports and catalogues. Since then, several models have come up and nowadays, DocuTech and DocuPrint models are used in the print of the inside block of the book, while Docu Color prints four-colour covers. With the birth of the Internet, Xerox decided to expand its markets and commercial core activity and instead of sitting only as supplier of hardware, decided, in October 1999, to join Bertelsmann71 in a partnership to develop POD web sites all over the planet. The mutual goals were the making the POD of hardcover books and putting on-line books for on-line ordering and digital printing by demand. For Bertelsmann, this means the possibility to offer its clients an integrated service by developing platforms for its publishing houses, book clubs and virtual bookshops and, by that way, exploring another distribution channel that will reach in seconds any client, anywhere in the planet and without getting out-of-stock. To Xerox meant entering the world of bookselling.

70 71

http://www.xerox-emea.com. "Livre la demande: Xerox et Bertelsmann investissent ensemble", Livres Hebdo, 22/10/99, page 5.

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Today, Xerox also promotes self-publishing. To accomplish this aim, the company has created a new service called Gutenberg 21 (Gutenberg Edition Service of the XXI Century) that gives editorial and technical support to authors whose books are made through Docu Tech and who desire a very special book, with an elegant book cover. The contract signed with the author is not an edition contract as he will be responsible for the commercialisation of the books. This service does not aim to compete with publishers and does not have an ultimate commercial goal as the profits will be directed towards the financing of cultural activities such as the preservation of old books. 4.2.1.2. IBM IBM has a long tradition in solutions for printing and supplies several POD companies. Among its latest models are IBM InfoPrint 4000, a high speed laser printers that print the interior block of books and IBM InfoColor 70, a printer used to print the four-colour cover of the books. However, IBM has been keeping its place as a simple supplier of hardware and not enlarging its activity range to other areas like Xerox has been doing. 4.2.2. The virtual salesmen 4.2.2.1. Lightning Source72 Lightning Source belongs to Ingram Industries, Inc., the most important American retailer, and it was the first company to launch, in 1997, the POD system with the help of IBM technology. Lightning Source began to sell books, via print-on-demand, through the traditional distribution network. However, progressively, Ingram changed from this classical distribution system to a direct expedition to the client system. Nowadays, it presents two options: POD and direct distribution to the customer and POD and wholesaler distribution. Lightning Source prints per month more than 100 000 POD books in more than 15 languages73. The company has the capacity of receiving and processing 17 000 orders and have the books ready for shipment in 48 hours. Within the period between 1997 and 2ooo, were sold 1,5 million copies on-demand. Nowadays, Lightning Source keeps commercial relationships with more than 800 publishing house such as Simon & Schuster, Time Warner, Harvard University Press, Cambridge University Press, Blackwell and Penguin, among others. These
72 73

http://www.lightningsource.com. "POD explained" in Bookseller, 8/12/00, pp. 30-31.

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companies add about an average of 400 new POD titles each week. Lightning Source has also entered the e-book wholesale distribution business. It has established a deal with Microsoft so that the e-books distributed by the company will be readable through Microsoft Reader but it is on a non-exclusive basis. Later came the deal with Adobe. 4.2.2.2. Barnes & Noble Barnes & Noble tried to buy Lightning Source at the beginning of 1999, but the American government refused to accept the operation for abuse of dominant market position. This led to the development of an independent project rival to the Lightning's one, in which the POD system is directly integrated in the B&N's web site. At the end of that year, Barnes & Noble became e-printer through a partnership with IBM74 for the creation of POD web sites. 4.2.2.3. Xlibris75 Xlibris is a Philadelphia-based company of on-line self-publishing. It assures the author that he will be the editor. The manuscript is given to Xlibris by the author and Xlibris digitises it and design a cover. The complete file is stored on the virtual bookshop as well as in other bookshops like Amazon.com and Borders.com. When a client wants to by a copy, Xlibris prints it (in hardback or paperback) and send it by regular mail or in electronic format. The rights are split between the company and the author. In April 2000, 49% of Xlibris' capital was acquired by Random House in order to use the experience and the knowledge of Xlibris in their electronic initiatives. Along with its associate, Xlibris offers new publishing services like an advice service for first authors about the publishing activity. Xlibris have come up with new publishing models as they use POD to bring author content directly to the marketplace at a very low cost. 4.2.2.4. Libri Libri is a major German book distributor who works with 4000 bookshops. Its position in the market has allowed the company to form a partnership with publishers, bookshops and Xerox to accomplish a
B&N, even though it belongs 50% to Bertelsmann preferred IBM technology whilst Bertelsmann has adopted Xerox technology for its web sites.
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http://www.xlibris.com.

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vast virtual library that grows at a rhythm of 200 new titles per month. The books, that are out-of-stock and whose reprint is decided based on the orders received, are digitised and afterwards printed in quantities that range from 50 to 100 copies that will arrive to clients mail boxes within 48 hours. Everything takes place on the Internet. Havas, who has recently created Havas Electronic Content Publishing is developing a similar project that include all the publishing houses (imprints) of the group but that each one will have a specific database conceived according to the type of books of the catalogue of each imprint. As I told before, POD is not innovative when we speak of communication, but, as we have seen, has revolutionised, and still is, the world of publishing in its distribution networks, in the relationship between its agents and between companies and clients and in the availability of contents. There are uncountable distribution companies and bookshops that have merely adopted this system in its network. Others, like the ones I referred before, have taken a step further and opened new markets. With POD, Lightning Source, a distributor, started dealing directly with final clients, without having to pass through intermediaries to reach them; Barnes & Noble followed the lead; Xlibris gave the concept of self-publishing a commercial nature and made the author into a editor; Libri brought out-of-stock titles back to life. These are important commercial innovations that sprang from the POD system and that made a difference in publishing. 4.3. Objects, Tools and Services As we have seen, e-paper and the printing-on-demand will make a difference in our lives from now on as well as in the development of the publishing industry. Still, the most spoken and known invention, if we may call it so, is the e-book and it has also created new objects: physical ones (hardware) and virtual ones (software and web sites). Will these also affect our lives? Or are they already doing it? 4.3.1. Hardware The birth of the e-book brought it with the development of already existing devices, like PDAs, and gave origin to the creation of new ones like the e-book containers. Both are machines that have one thing in common, they are ubiquitous computers as they can be easily carried (in the hand or in a small pocket) to any place and can contain inside more than one or two books. Still, we have not seen the end of it. Other

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items are being developed that give true sense to the concept of ubiquitous computer. In the near future, we will have them embedded in our clothes and house appliances and on other everyday objects that will communicate wirelessly with something resembling the Internet and will allows to have contents almost anywhere, quite at hand. 4.3.1.1. e-book containers 4.3.1.1.1. Gemstar Gemstar76 eBook Group Limited was formed by the acquisition, in January 2000, of the pioneer and leader companies of e-book devices (e-containers): SoftBook Press77, the creator of the Softbook Reader, and NuvoMedia, Inc.78, the maker of the Rocket eBook, by Gemstar-TV Guide International. In July 2000, Gemstar took total control over TV Guide, a global diversified media and communications company that operates three primary business units: TV Guide Entertainment Group, TV Guide Magazine Group and United Video Group that distribute products in the USA to over 100 million cable and satellite homes every week and sell its products in 45 countries. Gemstar-TV Guide International is the leading provider of electronic program-guide services, which allow a user to view a television program guide on-screen, obtain details about a show, sort shows by themes or categories, and select shows for tuning or recording. This operation enabled Gemstar to have free access to a huge diversity of contents that can be distributed digitally. To reinforce this strategy, in September 2000, Gemstar bought Les ditions 00h00, the French pioneer web site of e-books' sales and the leading European on-line electronic publishing company, and its holding company, Assam S.A. This acquisition was a decisive step for Gemstar-TV Guide to enter the electronic book business worldwide as 00h00 possesses a consolidated experience in selling e-books. Gemstar also joined Thomson Multimedia to conceive a second generation of ebook containers, smaller, with less weight than the Cytale and to be sold at cheaper prices in order to make this kind of technology and products user-friendly to the general public. It is a direct rival of Microsoft regarding data protection and electronic reading system.

76 77 78

http://www.gemstartvguide.com. http://www.softbook.com. http://www.rocket-ebook.com.

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By the time Gemstar launched its new e-book containers, it managed to gather in one set of products the hardware (e-container), the software and the contents, what showed an integrated business strategy to cater for all the customers' needs that want to buy an ebook. Along with the launching of its e-book devices, Gemstar presented an exclusive list of best-seller titles from the USA top Publishers that included authors like Patricia Cornwell, Robert Ludlum, James Patterson, Ken Follett, Ed McBain, Stephen King, Mary Higgins Clark, Scott Turow, Robert Ludlum, among others. Besides fiction best-sellers, it also presents history, business and many other genres and Random House Webster's Enhanced Electronic Dictionary will be installed on every licensed device. Besides e-books, Gemstar also offers the access to digital version of newspapers such as The New York Times, The Wall Street Journal, The Washington Post and magazines like Newsweek, Time, Fortune, Fast Company, Dow Jones Business News, The Industry Standard, and InfoWorld. Gemstar has presented two models: REB 1100 and REB 1200. They have enough memory to store 20 books but it can be expanded to over 100,000 pages with memory cards. They possess full colour, highresolution display and a built-in modem that allows the connection, registration and download of e-books without the need of a PC. Every book and periodical downloaded can also be stored in a personal bookshelf, what allows the building of an entire library. The text functions make key word searches possible as well as underlining passages, the insertion of markups and annotations and to vary font size according to each person optical need. Gemstar is an example of how a group starting from the development a device like an e-book container creates an integrated strategy of selling not only the hardware needed for the reading of ebooks but also the software and the contents so that it can provide its customers the complete set of elements ("objects") for them to enjoy the experience of reading e-books, being it comfortable or not. 4.3.1.1.2. Franklin79 Another company that is developing similar devices is Franklin, the creator of eBookman. Based in Burlington, New Jersey, the Company was established in 1981 and released, in 1986, the world's first handheld e-book device.
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http://www.franklin.com.

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Like Gemstar, Franklin has also been developing not only e-book hardware (in this case, hand-held) by creating eBookman, but also strives to offer its customers e-book content that may interest to a wide audience of users by making it available for several platforms like Palm and Windows CE. Along with it, Franklin has transformed its web site into an eBookstore where readers can get e-book titles from several content providers like print publishers of reference works (i.g. MerriamWebster, Larousse and HarperCollins for dictionaries and Medical Economics and Merck for medical works). Up to know, Franklin has sold more than 23,000,000 eBooks through 45,000 retail outlets all over the world as well as online through its web site, and through direct marketing operation. Its contents are available for reading through a several-choice e-book technology offer like Adobe Systems, Glassbook, Softbook Press, Mobipocket Reader and Peanut Press, among others. However, as a hand-held device, Ebookman, available in three different capacity versions, was conceived as a multimedia content player that allows the reading of books, listening to audio books and music and voice record. It also incorporates organiser functions, natural handwriting recognition and a multimedia card slot for memory expansion. These features make it more close to the personal digital assistant devices than to a simple e-book device like Gemstar or Cytale (please see chapter 3.3.5) ones. Its main function remains e-book reading but the integration of other functions is a good way to try to reach a broader audience. 4.3.1.2. Personal Digital Assistants (PDAs) Other devices that have adopted the e-book reading are the personal digital assistants, which are hand-held, pocket size, multimedia devices with proper operative systems and several features like date book, address book, calculator, note pad, memo pad, find function that serve to organise and carry short personal information. Examples of it are the Palm Pilot and the pocket PCs like Compaq iPAQ, Casio Cassiopeia, HP Jornada, which have incorporated e-book readers but, due its small pocket size, are good for reading technical cards of law, medicine, the news and other kind of small documents, but hardly to read a 300 page fiction book or essay. E-book containers are more appropriate for books of such dimension. Nonetheless, be it econtainers, like Gemstar devices and Ebookman, or PDAs, they are not paper, nor their characteristics are similar to the paper ones. So, it will

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a bit difficult for them to succeed in the way paper did, as they do not proportionate a comfortable reading, nor do they allow a true retention of what is read. 4.3.2. Software Along with the hardware devices came the virtual objects (software), if we may call it so, the tools, that enabled them to display e-books. These are the "readers" that are offered on a shareware or freeware basis in order to attract people to the consumption as e-books and as a way of counter-balancing the still high price of e-book containers or PDAs. Still, there is a vast variety of that kind of software that makes the reading of e-books dependent on the reading program of the company from where the e-books are bought. The lack of common reading platforms is, as I pointed out on chapter 2.4) one of the main obstacles to the development of the e-book market. Recently, companies like Cytale, Adobe, Gemstar and Microsoft understood that and started working together in order to create an universal format for e-books, named Open E-book (OEB). From that diversity of readers, there are too that stand out, the ones from Adobe and from Microsoft. 4.3.2.1. Adobe Acrobat E-Book Reader80 Adobe created the PDF format that retains with high accuracy book's graphics, page layout and fonts and presents several advantages over the html or word formats: the pdf files are not very heavy and can be read in quite different platforms like Macintosh, PC, Unix, among others; its functions of navigation, research function and zoom allow to take better profit from text and give an easier reading. Due to this and to its share-documents feature, a large number of organisations, from government agencies to universities, use Adobe pdf format to edit digital documents on-line. After the acquisition by Adobe of Glassbook Inc., the maker of Glassbook Reader e-book format, in August 2000, the file format for the Glassbook reader became the pdf and was renamed to Adobe Acrobat
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http://www.adobe.com/products/ebookreader/main.html.

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eBook Reader81. Finally, Adobe got a true reading software. It allows text lending (personal library of both owned and borrowed titles), the ability to rotate the text to suit the user, full-text searching, bookmarks, text highlights and annotations. It is an e-book reader supported simultaneously by Windows and Macintosh operating systems and can be installed in PCs, e-book containers and PDAs. 4.3.2.2.Microsoft Reader82 "For Thousands of years, the written word has given us clarity. Ins't it time we returned the favour?" Microsoft advertisement Microsoft Reader is Microsoft's tool for reading e-books. It was conceived to overcome the deficiencies that screens present in the reading on paper through the introduction of a clear typography, traditional format and pagination. It incorporates ClearType technology, which makes it easier to read small texts in screens, and Bookplate, a flexible technology system of copyright protection that registers the code of the client in the frontpage of the e-book or e-magazine. This registration is possible after the activation of the program that implies obligatory registration of the computer containing the program. Like Adobe's program, Microsoft Reader displays functions like highlight, annotate, turn pages, bookmark, copy text, change font size and type, full-text research and the insert drawings. The integrated dictionary (Encarta Pocket Dictionary), library of books and magazines, audio function (read and hear simultaneously the text on the screenaudio books) also present some added value to the traditional reading on paper and that are especially useful when the book on reading is study title. Microsoft Reader also allows bookshops to have access, by CDRom or the Internet, to e-books readable through Microsoft Reader. Like Adobe, Microsoft payback will be made as a payment of a royalty over the price of each e-book downloaded. Microsoft has assembled partnership with several publishers and booksellers in Europe and America, namely 00h00.com, Havas, Mondadori, Penguin, Simon & Schuster, University of Virginia eBook Library and Barnes & Noble, Amazon.com, W.H. Smith and R.R. Donneley.

81 82

http://www.ebooks.adobe.com. http://www.microsoft.com/reader.

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ReaderWorks83 is an authoring software used to convert documents, publications and books formatted in text and HTML files and images into Microsoft Reader format. It is compatible with the Open ebook84 format. OverDrive Inc., a Cleveland-based e-publishing software developer, has garnered Microsoft's certification to provide booksellers with digital rights management for Microsoft Reader, and to provide ebook publishers, content portals and resellers with copyright protection (rights management) based on Microsoft Digital Asset Server (DAS) technologies. As a consequence, OverDrive developed MIDAS technology that connects booksellers to OverDrive's computers through the Internet, which booksellers can add DAS to their web sites without having to buy expensive web hardware and software. OverDrive also decided to distribute ReaderWorks through Franklin. Microsoft has been developing other projects that try to adapt computer's interfaces to the way people write on paper. On the 2000's edition of Comdex show, Microsoft presented the prototype of a portable computing slate that it is operated not by a keyboard but by a pen. Though, one of the obstacles to surpass will be handwriting recognition and it is an incognita to know if Microsoft will be able to turn such a device will create a market. Nevertheless, Palm Computing notably succeeded in that area, by integrating a pen in its Palm Pilots that drastically simplified and limited its tasks and forced the computer user to conform to a highly structured character recognition system called Grafitti. However, to create a script-based system sophisticated enough for a PC will certainly be quite a different and a much more arduous task. Even though both Adobe and Microsoft readers are very similar in functionality, Adobe seems to have lead the way with a more stabilised software as it was built over an already existing reader. On the other hand, Microsoft seems to be trying to enlarge its activity around ebooks and e-publishing by developing solutions to in other areas like copyright protection, booksellers needs, improvement of computers' interfaces, namely those that have to do with reading and writing. 4.3.3. Web sites Besides new objects and new tools, the e-book gave also origin to new types of services. As we have seen in the last chapters, distributors
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http://www.readerworks.com. http://www.openebook.org.

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and bookshops adapted their traditional activities and their e-commerce activities to the selling of a new product whose existence is not even material, the e-book. New concepts of business have also arisen. The two examples that follow reflect some innovation as business activities as they have developed quite specific markets. NetLibrary provides ebooks to libraries while ipicturebooks martkets e-books for children. 4.3.3.1 Netlibrary85 NetLibrary is an American provider of electronic books to libraries that has managed to combine the traditions of the library system in organising, accessing and distributing content, with electronic publishing. It offers an easy-to-use information and retrieval system, via Internet, for accessing the full text of reference, scholarly, and professional books and it has in its database complete collections on subjects ranging from information technology to finance, from human resources to management, among others. It owns more than 37,000 complete titles currently available in ebook form, representing a broad range of subject areas that meets the needs of thousands of diverse library customers, including academic, public, corporate and special libraries in any part of the planet. Among the catalogues NetLibrary distributes are Houghton Mifflin and John Wiley, two major academic publishers. Although libraries are NetLibrary's largest market, the company is looking to expand into the education market as well as to increase the penetration in the consumer and the international markets. 4.3.3.2. iPicturebooks86 ipicturebooks.com was officially launched on February 8, 2001. It is an affiliate of Time Warner Trade Publishing whose activity is to provide high-quality e-books based on children's books from several publishers. Ipicturebooks also creates new e-books and make available in electronic format, books that have been out of print for years. Its target public ranges from children of six months' age to ten years old and the e-books are to be used in homes, schools and libraries. The web site is designed to appeal to parents, children, teachers and librarians seeking in-print, out-of print and original enhanced e-books for use on
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http://www.netlibrary.com. http://www.ipicturebooks.com.

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home computers, school and library networked computers, proprietary and open hand-helds and dedicated e-book readers. Ipicturebooks is trying to introduce a variety of "enhanced" ebooks, like original e-books illustrated digitally, "custom" e-books in which a child's name appears, "e-pop up books", e-books with spoken text and e-books with music and animation. If they succeed in doing that, they will manage to enter e-books in the true multimedia concept of integrated text, image and sound, and of taking it to the interactivity world through e-pop up books that make children react to and respond to the book's activities. The company also intends create interactive web pages for children. In addition to ipicturebooks.com's own online web store, the company hopes to establish co-branded boutiques with on-line retailers and educators, as the school and school-to-home markets present uncountable unexplored opportunities. The boutique was already launched with barnesandnoble.com, using the Adobe technology. Ipicturebooks has gathered around this project major American trade publishers, agents and authors like Henry Holt, Farrar, Straus and Giroux, Millbrook Press, Oxford University Press, Little Brown & Co., Two-Can Publishing, Macintosh+Otis and Writer's House. This shows the confidence of investors in the viability of project. All these new objects, being it objects in the traditional sense, like e-book containers or PDAs, tools like reading programs or new services like the ones presented by NetLibrary or Ipicturebooks, and being revolutionary or not in a communicational perspective, aim at improving our lives. To improve, they have to change. Small devices that allow us to carry to any place the content of several books without having to carry its physical weight with us are an improvement to our everyday lives. The fact they are not yet well developed in order to allow a comfortable reading is another issue and it cannot overshadow other improvements already accomplished. The reading software's capacity of enabling a student to take notes and zapping through books in seconds or of buying only the few chapters needed to do a thesis are definitely another improvement. Being able to have access to rare or out-of-print books or that are located in a library across the Atlantic is also a change in our habits and in the response to our needs. Having specific web sites where you know you can find precisely what you want, e.g. children's e-books, without having to take a plunge into the chaos that Internet is nowadays is also a step forward

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to make our lives easier. Like these, there are thousands of examples that could be accounted for. However, these were only made possible due to the creation of new objects, tools and services.

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5. CONCLUSIONS At the beginning of this thesis I raised several main questions regarding e-books and the eventual revolution that they might bring in the communicational and economical areas. Along the way those questions have originated more questions. Along the chapters of the thesis I tried to make a modest but serious personal contribution to the study of such questions. Here the conclusions that I managed to reach from the research done over those issues. - Can e-books and the new digital ways eventually surpass the concept of "printed word" and, more specifically, the book model? Books will not be replaced by digital content, namely by e-books and not even by e-paper. E-books, as any text to be read on a screen, small or big, pose major reading problems to any human, as screens still hurt our sight and do not have the characteristics of paper that make in a good material to read in. In the future, if the path to follow is e-paper it will only reinforce and develop the concepts of "printed word" and book. - Will they render a new communicational model? Not yet, because e-books, at this stage, do not permit a true absorption of contents as they are not adequate for long reading and epaper it is not fully developed. Both do not present yet any new significant feature that may originate a revolution in communicational terms. However, the concepts of mobility and stockage of information brought by the e-books have opened a door to a new process. Nevertheless, the marriage between low-cost publishing technology and the Internet has lead to the re-invention of distribution systems, created new markets for publishing houses and promoted a thinking of the roles of the agents of the publishing industry. - Can its appearance be considered a revolution within the terms of the on-going digital revolution? The true revolution will take place when e-book or e-paper will conquer the multimedia concept, by being able to integrate in their bodies text, image, film and sound, and integrate interactivity. The path is, as I have said before, set and the end is not far ahead.

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- If so, will this revolution have a simple technological scope or a broader one, i.e. social? Technology is nothing but a part of a revolution in Man's evolution. Every new "object" created will have to be able to act upon Man's and society's mentality and customs in order to succeed. And people will have to be prepared and willing to be acted upon. Nowadays, this acceptance has much to do with Economy as things that we accept end up by entering in a commercial circuit and only there can be considered winners or losers. - What kind of contents will be more successful? Some kind of e-book contents will certainly be more successful than others. Reference, technical and academic books, I believe, are possibly the branches of publishing that may have better chances of succeeding in the e-publishing world as, due to its characteristics, they are the kind of books that can take out the best advantages from the digital format. They can be enriched by what multimedia can offer them to help displaying information in a more attractive way. The digital format allows books to be sold chapters and be easily updated. The mobility that e-containers allow as well as its storage capacity can also improve students way of handling information and of reaching it when it is stored far away. - Despite the major investments from several big world editorial groups in this new market, in the last three years, the existing technology is still very far ahead of demand? As we have seen, the relationship between reading and formats and materials are not simple because they imply established cognitive processes of reading that exist for centuries, as well as the relationship between reader and text and between Man and object. Devices like PC, PDAs or e-book containers and its related software are far from catering for the needs that Man has when he reads a text. It is true that these devices present some extra qualities like mobility and optimised storage of contents but these are not the essential features. The main issue continues to be the process of reading. Without it no device will conquer entirely Man's affects and choices. So far, the only "device" that may, in a near future, gather the characteristics of the human reading process, paper qualities related with it and new features like mobility and optimised storage of contents

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is e-paper. For the other devices that I mentioned before, its interfaces will have to improve significantly. E-books, even if they opened the way for a new era in publishing, are not, in their present form, revolutionary from the communicational point. - Are there several different regional business models, like, for instance, an European one and an American one, among others? There are different business models but that are not defined by geographical features. This is due to the fact that Internet and the groups themselves have given business a global dimension. As we have seen, publishers, distributors, libraries, authors, booksellers have started their e-publishing ventures and they have approached the subject in various ways, with different business models, both in Europe (and in Portugal) and in the US. They tried what they did not know about - new ways of selling, distributing, promoting, of paying rights and even of making their accountability. So, profound changes have been affecting the publishing industry. Publishers, distributors, authors, booksellers see their roles being interchanged: authors are becoming e-publishers, booksellers are now e-publishers and e-printers and some publishers are turning to edistribution. As we have seen, the American industry has lead a determinant role in the e-books history since its initial euphoria to its present day scepticism. However, we cannot conform ourselves with the generalised radical idea of the US technological supremacy versus a public moneyfed Europe. As we have seen, two major worldwide media groups, Bertelsmann and Vivendi Universal, that are investing in e-books and epublishing are European based and can compete with other media giants like AOL Time Warner or Viacom. Smaller publishing groups like Penguin have joined in and ventures like 00h00.com, in the area of selling e-books, and Cytale, in the field of e-book containers, were pioneer and innovative. The distance between European industry and the digital scene in the field of e-publishing is not that large. - Will Portugal fit in any of them? No, because there is only one commercial venture example and it is not significant as it does not improve the existing models. It can be said that Portugal, despite all the illusive high level of buying and subscription of high-tech products and services, is quite far behind a

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true change into a digital mentality and just stepping in, for the first time, in some fields of the New Economy like e-publishing. - How may the new objects and tools affect our life? The changes that have been happening in books and publishing have originated and are still originating and developing new objects. As we have seen, e-books and related services, e-book containers, PDAs, reading programs, e-paper and the printing-on-demand will make a difference in our lives from now on as they aim to improving our lives and to improve, they have to change. Small devices that allow us to carry to any place the content of several books without having to carry its physical weight with us are an improvement to our everyday lives. The fact they are not yet well developed in order to allow a comfortable reading is another issue and it cannot overshadow other improvements already accomplished. The reading software's capacity of enabling a student to take notes and zapping through books in seconds or of buying only the few chapters needed to do a thesis are definitely another improvement. Being able to have access to rare or out-of-print books or that are located in a library across the Atlantic is also a good change. Besides these, other conclusions have necessarily come out. Pioneer projects like Project Gutenberg, The University of Virginia Library Electronic Text Centre and the Portuguese DiTed Project have shown how independent projects can be successful and, simultaneously, give their contribution to the dissemination of works and knowledge among us and to the research of new ways of exploring the potentialities of the digital format. There are global market tendencies that dominate the planet. Several major media groups have given their businesses a global dimension. These groups have abandoned the exclusivity of its original core activities and have set integrated strategies that gathered no only content production but also distribution, namely in the Internet area. In the publishing business this has lead to a true revolution whose main feature is the emerging market of e-books and e-publishing where synergies seem to gather and roles start to change. After the initial ebook euphoria (1998-2000) came a more apprehensive, adult perspective of the market. However, what has been developed both in

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Europe and America in this field cannot and will not be put aside or forgotten. The re-invention of a whole business chain has started and it is a fact, that people relationship with computers and Internet usage is growing everyday more and more consolidated, especially in the United States and, progressively, in Europe, despite the Economy's health. This whole new revolution that is starting will take time to see its seeds spring as companies that have been investing in this area will take quite a long time to succeed and to see the money they have been investing back. As we have been watching in the last year, in general, the euphoria about all the Internet and new media related ventures has cooled down and people finally managed to see that "they wouldn't get rich in a eye blink". On the other hand, even though evolution is at a breath-taking velocity these days, human habits still take time to change, but they do.

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BIBLIOGRAPHY:
BOOKS BARTHES, Roland; Marty, Eric, "Oral/Escrito" in Enciclopdia Einaudi, vol. 11, Lisbon, Imprensa Nacional-Casa da Moeda, 1987. BARTHES, Roland; Compagnon, Antoine, "Leitura" in Enciclopdia Einaudi, vol. 11, Lisbon, Imprensa Nacional-Casa da Moeda, 1987. DUGUID, Paul, "Material Matters: the Past and Futurology of the Book" in The Future of the Book, Berkeley and Los Angeles, University of California Press, 1996. FOUCAULT, Michel, As Palavras e as Coisas, Lisbon, Edies 70, 1998. FURTADO, Jos Afonso, Os Livros e as Leituras: Novas Ecologias da Informao, Lisboa, Livros e Leituras, 2000. GODIN, Seth; Gladwell, http://www.ideavirus.com). Malcolm, Unleashing the Ideavirus, (available in

HESSE, Carla, "Books in Time" in The Future of the Book, Berkeley and Los Angeles, University of California Press, 1996. KERCKHOVE, Derrick De, A Pele da Cultura, Lisbon, Relgio d'gua, 1997. NEGROPONTE, Nicholas, Being Digital, London, Coronet Books, (1995) 1998. SNYDER, Ilana (ed.), Page to Screen: Taking Literacy into the Electronic Era, London and New York, Routledge, 1998. WOLTON, Dominique, E Depois da Internet ?, Algs, Difel, 2000. MAGAZINES FELDMAN, Gayle, "E-fulfilment deal for S&S, Lightning Source" in The Bookseller, 14/07/2000, page 10. TOURAINE, Agns interview in Livres Hebdo, n 359, 26/11/99, pp. 59. "Livre la demande: Xerox et Bertelsmann investissent ensemble", Livres Hebdo, 22/10/99, page 5. "POD explained", Bookseller, 8/12/00, pp. 30-31. Semana Informtica, n 549, 13-19 Abril 2001, Ferreira & Bento, Lisboa. Semana Informtica, n 557, 8-14 Junho 2001, Ferreira & Bento, Lisboa.

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REPORTS CARNEIRO, Roberto, "Portugal Digital - Atribulaes de uma Sociedade em Transio" in Tendncias XXI, n 3, Lisbon, AODC, March 1998. Anurio da Comunicao 2000-2001, Lisbon, Obercom, 2000. Compuware's report on the Portuguese web sites operability, available http://www.europemedia.net/shownews.asp?ArticleID=1588&Print=true. STATISTICS Estatsticas sobre o Servio de Telecomunicaes Mveis: Servio Mvel Terrestre 2 Trimestre de 2001, Instituto de Comunicaes de Portugal, available in http://www.icp.pt/publicacoes/estcom/stcm/smt2_01.html. Home Computers and Internet Use in the United States: August 2000, U.S. Department of Commerce/U.S. Census Bureau, 2001, available in http://www.census.gov/population/www/socdemo/computer.html. Inqurito Utilizao das Tecnologias de Informao e Comunicao pela Populao Portuguesa - 2001, Observatrio das Cincias e das Tecnologias, 2001 (provisory results), available in http://wwwcisi.mct.pt/actividade.index.html. Level of Internet Access in Europe, Eurostat, available http://europa.eu.int/comm/eurostat/Public/datashop/print-product/EN? catalogue=Eurostat&product=1-24010pc-EN&mode=download. in in

WEBINDEX:
E-books: Oxford English Dictionary on-line http://www.oed.com/ Stephen King's web site http://www.stephenking.com Surfista (O) http://ebook.clix.pt/ Unleashing the Idea Virus http://www.ideavirus.com Venha o Diabo e Escolha http://ebook.clix.pt/ E-book software: Adobe Acrobat e-book Reader

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http://www.ebooks.adobe.com; http://www.adobe.com/products/ebookreader/main.html Microsoft Reader http://www.microsoft.com/reader E-containers: Cytale http://www.cytale.com eBookman http://www.franklin.com Gemstar http://www.gemstartvguide.com Nuvomedia http://www.nuvomedia.com Rocket-eBook.com http://www.rocket-ebook.com SoftBook.com http://www.softbook.com E-paper: E Ink http://www.eink.com Gyricon http://www.parc.xerox.com/dhl/projects/gyricon/ Projects: Gutenberg Project http://promo.net/pg/ National Portuguese Library DiTeD Project http://dited.bn.pt The MIT e-paper project http://www.media.mit.edu/micromedia/elecpaper.html University of Virginia Library Electronic Text Centre http://etext.lib.virginia.edu Statistics: APEL - O Livro em Portugal - Estatsticas de Edio de Livros Relativas ao Ano de 1999 http://www.apel.pt/livro/habitos1999/habitos.html

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Compuware's report on the Portuguese web sites operability http://www.europemedia.net/shownews.asp?ArticleID=1588&Print=true Eurostat Report on the Level of Internet Access in Europe http://europa.eu.int/comm/eurostat/Public/datashop/print-product/EN? catalogue=Eurostat&product=1-24010pc-EN&mode=download Home Computers and Internet Use in the United States: August 2000 http://www.census.gov/population/www/socdemo/computer.html ICP - Estatsticas - Servio de Telecomunicaes Mveis/Servio Mvel Terrestre 2 Trimestre de 2001 http://www.icp.pt/publicacoes/estcom/stcm/smt2_01.html ICP - Estatsticas - Servios de Transmisso de Dados / Servio de Acesso Internet - 1 e 2 Trimestres 2001 http://www.icp.pt/publicacoes/estcom/stcm/stdados2_01.html Inqurito Utilizao das Tecnologias de Informao e Comunicao pela Populao Portuguesa - 2001, Observatrio das Cincias e das Tecnologias, 2001 (provisory results) http://wwwcisi.mct.pt/actividade.index.html Europemedia http:www.europemedia.net Web sites: ditions 00h00 http://www.00h00.com iPicture Books http://www.ipicturebooks.com Lightning Source http://www.lightningsource.com Netlibrary http://www.netlibrary.com Simon & Schuster http://www.simonsays.com/ebooks TexEdiNet http://www.mediabooks.pt Xlibris http://www.xlibris.com Penguin

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http://www.penguin.co.uk Xerox - POD http://www.xerox-emea.com

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APPENDICES

Appendix 1

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Interview with Carlos Santiago

(TexEdiNet manager) 2/03/01

- Why have you decided to enter the e-book market? Carlos Santiago - We believe that Internet area and the electronic distribution of contents had a very big evolution and that it will represent, in the future, a base from which the serious business will be conducted. Because we believe in this and because we have entered this area of contents production for distribution in digital format, CD, Internet and DVD some years ago, it represents a natural step in our strategy. We are convinced by our own experience that there is a real market for electronic books. - So, you believe that it won't be a passing-by fashion? CS - No, I'm convinced that it won't but I'm also convinced that it won't be in six months or a year that an electronic books will have a base from which it will be read. This is because we are also not convinced that an electronic book will be read on the PCs because it is not its purpose. The electronic book is supposed to be read on a more portable device such as Palm Pilots or Ipacks from Compaq, more developed electronic notebooks, even mobile phones or a mixture between notebook and mobile phone. It will be via those small devices, which are close to people, that the electronic books will be read. So, it will take more than six months or a year so that those small devices will appear, at least in the form that the market will see them as an alternative, but we are convinced that they will appear. - In your opinion, what will be the market share for e-books? CS - We don't have any perspectives at this moment. Our objective for the year 2001 is to publish 10% of the new publishing funds launched in Portugal. On average, there are 6500 to 7000 books published per year in Portugal. We would like to publish 700 e-books. The contact with the publishers was made in order to reach this goal but it doesn't mean that it will represent 10% of a market share. Nevertheless, we think that if, for a 2001 goal, we manage to publish 10% of a publishing fund, it would be an excellent result. But, how many people will have e-books and physical books, I can't tell you.

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- Do you think that you will steal a market share from a traditional book? CS - I'm convinced that it won't be so. It didn't happen elsewhere i.e. electronic books buyers are mainly those who didn't used to buy physical books. They are new clients brought to the market. It is a bit like what happens with VHS buyers. They don't stop going to the cinema. The targets and markets are different, as well as the objectives. In my opinion it won't steal market share from a physical book. - What are the advantages of e-book over the paper book? CS - What is more obvious is the fact that on a device we can transport a larger amount of books than it would be possible to transport physically. I can take twenty, thirty books in a notebook but, when it comes to the physical books, I would need a car. The possibility of research and of making links in the books is also interesting, specially when dealing with technical books, where there are indexes that makes us loose time in this type of research. With the e-book, it is enough to make a criterion research and you get to the right place. There is a greater easiness of usage. In my opinion, those are the two main advantages of using an e-book. - There is always a question of visibility on the screen. CS - These technical issues have already been solved. Today, the Microsoft Reader, which we are going to adopt in next few months when it is stabilised, or the version of Acrobat e-book Reader are already versions that contain Clear Type and Clear Reader technologies that allow a clearer visualisation of letters. The equipment scintillates less and less and has a screen image of higher quality. It is a technical issue that will soon be surpassed. - What kind of books are more adaptable to this support? CS - At the beginning, will be technical books or books for accountants, books for computer technicians, management or law books. But it is possible to read any kind of book here. The more developed are the hardware platforms where I can read books and more portable they are and better reading they proportionate, more rapidly other types of books will appear. I'm convinced that the time will come when people will read a novel or the daily newspaper on these devices. I think that it will be possible and not very far away in the future. It can happen with

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any kind of product, magazine, newspaper or novel. At the beginning, no doubt, it will be the technical books. - Why choosing Adobe Reader rather than Microsoft one? CS - At this moment it is a warranty of safety that we have and the proper stability of software. The Microsoft one doesn't show stability yet. It crashes very often when is being used and when the file is being made. The Acrobat one has already a 2.0 version, is at least for two years in the market via Glassbook, an original software creator which was recently acquired by Adobe, and presents more stability. Adobe also has better equipment for the e-book generation than the one Microsoft has. Microsoft has to create a product from zero. For a schoolbook publisher like us, which has all of its production based on utensils like Quark Express, the passage from these utensils to the plate exit is being made electronically. An introduction of a new additional element, when it is being sent to the plate exit and which makes it possible to create technology apart, turns out to be easy with the Adobe technology, already robust and easy to handle. It wouldn't be so easy to transfer other publishers' books because we would need to convert those books to electronic format. Nowadays, Adobe software doesn't contain any bug. It is fast and stable. There are also the questions of security: print control, copy and loan. All of this is already presented in this software, which is not the case with Microsoft. Do you plan to go into partnership with hardware suppliers, especially of e-books, PDAs and mobile phones? CS - We are working on it. It is natural that, in a few weeks time, will appear on the Mediabooks web site hardware bases which we suggest to our clients, especially because who buys an e-book will have a tendency to buy the hardware base. So, it is possible that this will happen in the next few months because we are in advanced negotiations with some hardware representatives in Portugal. We don't expect to import because hardware is not our business. Although we recommend hardware, it will be the specialised companies that will make the sale. Partnerships will be varied for sure. - Do you plan to adapt the contents distributed to these devices? CS - Yes. - Can you get some conclusions from the existing European examples, although they are very recent?

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CS - We attend US events regularly, especially various fairs, and it is from there that we take the majority of our ideas. Normally, when we hear of something new there, it takes two years for the same thing to appear in Portugal. So, when we go there, we bring back what might happen in the future. For example, last year I went to Internet World in New York, where various conferences about e-books took place. There, I met publishers and authors and attended discussions about the problem of control of author's rights and download. One publisher said that he was already selling e-books for two years and that he didn't have any control over the sales but that he was only charging for the sale of books. He also said that, according to the market research he made on his books, he only had 20% level of piracy i.e. 80% of the books sold by the publisher were bought. In his opinion, those 20% equals what he looses on the sale of physical books due to the photocopies and so it isn't necessary to control downloads or author's rights because, if he sells 80% and has only 20% of piracy, he has the same problem as with the physical books. Of course, authors started to rise against him. No one is prepared to write a book and don't receive anything for it. On the other hand, there are some that sell only by print control, download etc. The examples are very unequal even at the technological level. There are some who have totally adapted to selling e-books as an executable i.e. software. There are others who sell e-books as a Word file. - What was the amount invested? CS - There are two sides here. One is Texto Editora, who had to adapt its structure in order to be able to produce e-books. For us, that already have all of production in a digital format, producing e-book is of low cost because it is produced side by side with the physical book. On behalf of Media Books, the investment was 70.000.000 escudos, which not only included e-books as the transformation of the shop as well. If I isolated the question of e-books, I would deal with 10.000.000 escudos and every time there is a download, there is a fee to be paid to Adobe for every book sold, it is like a right i.e. a sale commission. This fee is public; it is present in the contract and equals 3% of every book sold. - What is your prevision of a number of publishers taking part in this? CS - We don't have any specific numbers regarding publishers. Our goal is to publish 700 e-books from several publishers. It is clear that we want to gather as many publishers as possible. We are going to make a funny experience by publishing one book chapter by chapter. There is no definite number of publishers.

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- How long, in your opinion, will take to pay off your investment and start making profit? CS - We think that during 2004 the investment made will be recovered, that is, in a little over than a year and half. - Do you plan on selling only books in Portuguese or will you extend it to other languages? CS - No, we plan on selling books from any publisher. As Media Books is the one that guarantees the transformation of book to the e-book base, at this moment we are only having contacts with the Portuguese publishers. If there will be, eventually, a publisher who will present a book in a foreign language, it will be accepted but, at this moment, it is not our primary concern. - Are you planning the distribution of other products, such as magazines? CS - Although Media Books is distributing books, CDs, DVD and magazines, the e-book base concentrates only on the issue of books. Distribution of newspapers and magazines may be the next step. It doesn't depend so much on us as on the will of the newspaper and magazine editors. Media Books is only a distributor and we, to give an impulse to this market, are assuring transformation of books and serving the publishers, something that in a well organised market a distributor wouldn't do. Media Books is a distributor, a bookshop that sells what the publisher is producing. At this point, we are making this service for the publisher free of charge. When we talk about newspapers and magazines, we talk about editorial products of completely different nature, depending more on the will of the editors. Media Books is ready to sell magazines and newspapers as it sells e-books. It is like a book for us. If an editor wishes to publish a magazine or a newspaper as ebook, Media Books also guarantees the transformation without any charge. - At the global level, Random House started a war of prices and percentages of author's rights, proposing prices a lot lower than the prices of the paper book market, fascinating authors with the higher percentage of author's rights, making a profit division of 50/50%. What do you think it will happen?

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CS - It depends really of the publishers position. We, Media Books, are a distribution net. We don't set prices. Media Books at the time of the opening the market for e-books made a demonstration of price calculation, taking into consideration traditional formation of prices for the physical book. Taking the cost of production of the book, applying a factor that takes it into consideration, adding a cost of distribution and the author's rights makes this equation. This factor in the traditional market is four. At the demonstration we made for the publishers of the price calculation for e-books, we proposed a price inferior about 20% to 40% to the price of the physical book making sure that the publisher gets the same profit. When this war stabilises at the international level, the prices will be fixed 20%-40% lower than the physical book. The war is completely different when it comes to authors because it depends on the publisher. The norm of the traditional market is 10% for the author's rights and, as it is natural, the author for selling e-book will not be ready to lower this percentage. We have to convince authors that selling an e-book may be much bigger deal than selling physical books because it is possible to sell much higher number of e-books than physical books. There is a need to find a balance but it may just take a while. - You are probably acquainted with the Stephen King case, which, being a promising experience at the beginning, turned out to be a failure, obliging author to abandon the project. CS - It happened for the first time and we don't think that it is a striking example for this market. It doesn't correspond to the norm.

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Appendix 2

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CONTRATO DE DISTRIBUIO DE PUBLICAES EM FORMATO ELECTRNICO (original) Entre 1 - TexEdiNet - Consultoria para os Negcios, Lda., empresa do grupo Texto Editora que desenvolve a sua actividade na rea denominada nova economia, designadamente na Internet. Pessoa colectiva n. 504 678 027, com sede na Estrada de Pao de Arcos, n. 66 e 66 A, Cacm, Sintra, com o capital social de 5.000 Euros. Matriculada na Conservatria do Registo Comercial de Cascais sob o n. 14798 - Sintra, representada pelos seus gerentes Carlos Alberto dos Santos Santiago e Manuel Jos do Esprito Santo Ferro, adiante designada por TextEdiNet; 2 n. pessoa colectiva , com sede na , em , com o , matriculada na Conservatria do Registo sob o n. , representada ,

capital de Comercial de pelo seu gerente adiante designada por Editor. Considerando que:

A)A TexEdiNet detentora de um site na Internet, com a designao de MediaBooks, uma livraria virtual prestigiada e de grande dimenso, a qual funciona como uma livraria on-line, sendo o seu enfoque na venda de livros, vdeos, dvd, jogos, produtos multimdia e outros produtos audiovisuais. B)A MediaBooks utiliza um sistema de distribuio on-line, que lhe permite, mediante pagamento, a colocao disposio do pblico de obras que ela publica em formato electrnico, transmissveis pela via da rede informtica e de telecomunicaes, especialmente pela Internet. Atravs deste sistema, a MediaBooks prope, ao pblico que visita o seu site, alm de toda a oferta na distribuio de produtos fsicos, a opo de compra das obras em formato electrnico.

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C)A TexEdiNet deseja adquirir os seus direitos de comercializao exclusiva on-line para todas as redes de telecomunicaes das obras objecto deste contrato cujos direitos de autor pertencem ao Editor. D)O Editor declara ter sido correctamente informado do sistema de distribuio on-line da MediaBooks, e nomeadamente a forma em que as obras sero propostas de acordo com as seguintes caractersticas: A MediaBooks utiliza um sistema de edio on-line que permite a recuperao de todo o tipo de texto, em qualquer formato, bem como enriquec-lo, armazen-lo, dentro de um banco de dados. Este sistema permite o acesso dos livros por ttulo, autor, gnero, etc. alm de possibilitar a sada de um ficheiro electrnico, e de ter uma transaco com segurana, tanto no envio do ficheiro ao leitor, quanto ao pagamento. A TexEdiNet suporta a totalidade dos custos de transformao das obras para suporte electrnico no formato necessrio comercializao do mesmo na MediaBooks. As obras so apresentadas e podem ser compradas directamente por transmisso de dados. So ficheiros electrnicos entregues ao leitor que possibilita uma verdadeira apresentao no ecr do dispositivo de leitura electrnica e prope tambm algumas funcionalidades preciosas como a ferramenta de pesquisa em texto integral. O ficheiro enviado ao cliente pela rede de telecomunicaes disponvel desde que a transaco tenha sido registada. Com o objectivo de assegurar a proteco da propriedade intelectual do contedo, o texto entregue criptografado com a senha para permitir a leitura imediata. O Cliente pode ser autorizado a imprimir o texto para uso pessoal e de forma controlada. A TexEdiNet pode tambm propor o exemplar electrnico em outros formatos desde que o mercado desses utenslios esteja suficientemente desenvolvido. O contedo das obras disponibilizadas pelo Editor na MediaBooks, so da inteira responsabilidade do Editor. E)Se o leitor desejar encomendar um exemplar sob a forma fsica, este ser comprado directamente ao Editor pela TexEdiNet que ser intermediria na transaco, no mbito do servio habitualmente prestado pela MediaBooks e regulado pelo contrato para tal existente. F)A TexEdiNet declara ter tomado as disposies legais e tcnicas necessrias para assegurar o respeito dos direitos de autor por parte dos utilizadores do seu site e especialmente para limitar a reproduo por transmisso de textos destinados utilizao pessoal do comprador. 120

G)A seleco das obras ser pelo Editor e pela TexEdiNet de comum acordo, constando de uma relao anexo ao presente contrato, a qual poder ser alterada por comunicao escrita entre partes. livre e de boa f acordado o seguinte: -1(Cedncia de Direitos) O Editor cede TexEdiNet o exclusivo direito de distribuir on-line em formato electrnico, em todas as redes de telecomunicaes (Internet, Cabo, Satlite, Televiso, etc.) as obras da lista anexa ao contrato. A distribuio prevista no pargrafo anterior consubstancia-se na venda por parte da MediaBooks das obras objecto deste contrato, por via electrnica, atravs da transmisso de dados electrnicos. -2(Propriedade dos Direitos) O Editor assegura TexEdiNet que o legitimo proprietrio das obras e que dispe do direito para autorizar a distribuio objecto deste contrato e assume a responsabilidade perante terceiros por quaisquer reclamaes ao reivindicaes que possam vir a ser evocadas -3(Consulta Parcial Gratuita) A MediaBooks poder disponibilizar para consulta gratuita, partes das obras, objecto deste contrato, aos seus clientes e visitantes, com o objectivo de promover a venda das obras. -4(Fornecimento de Suporte Informtico) O Editor fornece neste acto TexEdiNet, um suporte informtico contendo os ficheiros das obras tal como existem em suporte de papel (obras impressas). Em relao a todas as obras que venham a ser includas na lista anexa, o referido suporte informtico tem de ser fornecido no momento da sua incluso na lista. -5(Preo de Venda ao Pblico) O preo de venda ao pblico das obras em formato electrnico fixado pelo Editor e faz parte da lista anexa ao presente contrato.

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-6(Variao do preo) Se o preo de venda ao pblico das obras sob a forma electrnica variar, a margem de comercializao ser calculada com base no novo preo e a partir da data em que este entra em vigor, obrigando-se o Editor a comunicar o novo preo com uma antecedncia mnima de 30 dias e fazendo essa comunicao em suporte electrnico onde conste pelo menos o ISBN, o ttulo e o novo preo da obra. -7(Prazo da Publicao) A TexEdiNet garante a publicao on-line das obras num prazo de 3 meses, contando a partir do fornecimento dos suportes informticos. No caso de no publicao das obras no prazo referido, pode o Editor, se desejar, rescindir o contrato, um ms aps o envio de uma carta registada TexEdiNet comunicando a sua inteno. -8(Margens) A margem da MediaBooks na comercializao dos livros em suporte electrnico de 50% sobre o PVP sem IVA definido pelo Editor de acordo com o estipulado na clusula 5. As vendas apuradas com base nos relatrios mensais entregues, sero facturadas pelo Editor TexEdiNet. Os pagamentos sero efectuados a 60 dias aps a data da factura. -9(Controlo e Fiscalizao) O Editor dispe do direito de controlar e fiscalizar todo o processo de comercializao on-line das suas obras em formato electrnico na MediaBooks, Para tal a TexEdiNet disponibiliza ferramentas electrnicas de fiscalizao e disponibiliza o acesso aos seus sistemas pelo pessoal tcnico ou no tcnico que o Editor entender, com o objectivo nico de fiscalizao das obras objecto deste contrato. -10(Vigncia) O presente contrato vigora pelo prazo de cinco anos, com incio na data da sua assinatura e, considera-se automaticamente renovado, por iguais e sucessivos perodos, desde que no seja denunciado por qualquer dos autorgantes, com pelo menos seis meses de antecedncia

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relativamente ao seu termo ou ao do dos perodos de renovao, atravs de carta registada com aviso de recepo. -11(Direito de Preferncia) Durante a vigncia do presente contrato, o Editor obriga-se a dar a preferncia TexEdiNet na distribuio em formato electrnico das suas obras. -12(Tribunal Competente) Para todas as questes emergentes do presente acordo estabelecido o Foro da Comarca de Lisboa, com expressa renncia a qualquer outro. O presente acordo feito em duas vias, iguais e, de igual valor, ficando um exemplar em poder de cada uma das partes. Lisboa, TexEdiNet de de

Editor

AGREEMENT FOR THE DISTRIBUTION OF TEXTS PUBLISHED IN ELECTRONIC FORMAT (translation) Between

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1st - TexEdiNet - Consultoria para os Negcios, Lda., company of the Texto Editora group, that develops its activity in the new economy area, namely in the Internet. Register nr. 504 678 027, with head office in Estrada de Pao de Arcos, nr. 66 and 66 A, Cacm, Sintra, with a social capital of 5.000 Euros. Registered in the Commercial Register of Cascais under the nr. 14798 - Sintra, here represented by its managers, Carlos Alberto dos Santos Santiago and Manuel Jos do Esprito Santo Ferro, designated as TextEdiNet; 2nd , with head office in capital of , in , with a , registered in the Commercial Register of under the nr. , here represented by register nr.

its manager , designated as Publisher. Considering that: A) TexEdiNet owns a web site, named MediaBooks, a well-known virtual bookshop, that works as a on-line bookshop, being its main activity the commercialisation of books, videos, dvd, games, multimedia products and other audio-visual products. B)MediaBooks uses an on-line distribution system that allows, by payment, the commercialisation of works that are published in digital format and that circulate via computer and communication nets, especially through the Internet. Through this system, MediaBooks presents the buyers that visit its web site, besides a whole distribution catalogue of material products, the option of buying of books in digital format. C) TexEdiNet wishes to acquire the exclusive rights of on-line commercialisation, through all communication nets, of the works hired under this contract and whose rights belong to the Publisher. D)The Publisher declares to have been thoroughly informed of the working conditions of the on-line distribution system of MediaBooks, and namely of the format and characteristics that the books proposed for contract should have: MediaBooks uses an on-line edition system that allows the recovery of any kind of text, in any format, as well as its enrichment and its storage in an electronic database. This system allows the access to

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books by title, author, genre, etc., the output of an electronic file and the secure transaction in the transmission of the file and in the payment process. TexEdiNet will pay the total costs of the transformation of the books into the electronic version in a format proper for the commercialisation by MediaBooks. The books are presented and can be bought directly by means of data transmission. They are electronic files that are delivered to the reader that allow a true display in the screen of electronic reading device and offer also some extra functions like a text-research tool. The file is sent to the client through the communication net and it is available after the registration of the transaction. Aiming to reassure the protection of intellectual property of the content, the text is delivered encrypted with a password that allows the immediate reading. The client can be allowed to print the text for personal purposes and in a controlled way. TexEdiNet can also supply the electronic work in other formats as long as the market for such tools is reasonably developed. The content of the work offered by the Publisher through MediaBooks is from the entire responsibility of the Publisher. E) If the reader wishes to order a book in the material format, this one will be directly bought to the Publisher by TexEdiNet, who will be a intermediary in the transaction and that will be done within the service traditionally presented by MediaBooks and regulated by the distribution contract established for that type of transaction. F) TexEdiNet declares to have knowledge of the needed legal and technical rules to ensure the respect for the authors' rights by the users of the web site and, especially, to limit the reproduction by data transmission of texts for personal use of the buyer. G)The selection of the books to be published will be done by the Publisher and by TexEdiNet by mutual agreement, being it specified in a appendix of the present contract and it can be changed by written agreement between both parties. It is agreed, by good will from both parties, the following premisses: -1st(Cession of rights) The Publisher gives to TexEdiNet the exclusive right of distributing on-line, in electronic format, through all the communication networks 125

(Internet, cable, satellite, television, etc.), the works mentioned in the list that is included in the contract. The distribution described in the former paragraph is made through the commercialisation, by MediaBooks, of the works under this contract, through the electronic way and by means of transmission of electronic data. -2nd(Rights ownership) The Publisher ensures TexEdiNet that it is the legitimate owner of the works and that has the right to authorise its distribution. It also has the responsibility to third parties for any claims that may be presented. -3rd(Free partial reading) MediaBooks may display to its clients and visitors, for free reading, parts of the works hired under this contract, with the aim to promote the sales of the works. -4th(Supply of the electronic support) The Publisher supplies TexEdiNet with an electronic support with the files of the works as equal as they exist in paper format (printed works). As to all the works that may join, in the future, the list that accompanies this contract, the referred electronic support will have to be supplied at the time of its inclusion in this list. -5th(Selling price) The selling price of the books in electronic format is set by the Publisher and it is specified in the list that accompanies the contract.

-6th(Price variation) If the selling price of the works in electronic format varies, the percentage of commercialisation will be determined based on the new price and it will be applied from the date in which it will be set onwards, being the Publisher obliged to communicate the new price at least 30 days before that date and making such communication in electronic format where it should be written, at least, the ISBN, the title and the new price of the book.

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-7th(Publication deadline) TexEdiNet reassures the on-line publication of the books within 3 months counting from the date of the supply of the electronic support. If the book is not published within the specified deadline, the Publisher can, if it is its wish, to cancel the contract a month after the sending of a registered letter to TexEdiNet in which this company is informed of the Publisher's decision. -8th(Percentage) The profit percentage of MediaBooks in the commercialisation of the books in electronic format is of 50% over the selling price without VAT established by the Publisher according to what was established in nr. 5. The sales presented in the monthly sales reports will be debited by the Publisher to TexEdiNet. The payments will be done 60 days over the date of the invoice. -9th(Control and auditing) The Publisher has the right to control and audit the whole on-line commercialisation of its works by MediaBooks, To accomplish that aim, TexEdiNet provides electronic auditing tools and the access to its systems to the technical or non-technical staff that the Publisher wishes to see it and with the only aim to audit the works that are under this contract. -10th(Duration) This contract is valid for five years starting from the date of its signature and it is automatically renewed for equal and continuous periods of time, unless any of the parties decides to cancel it, at least, six months before its ending or the end of the renovation periods, by registered letter. -11th(Preference right) During the time of this contract, the Publisher is obliged to give preference to TexEdiNet on the distribution in electronic format of its works. -12th-

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(Court) For all the questions rosen by this contract, it is established that the court valid to address them is uniquely the Foro da Comarca de Lisboa. From this agreement are made two equal copies, of equal value, being that each one of the copies should remain with each of the parties. Lisbon, TexEdiNet

Publisher

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Appendix 3

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1. Internet accesses in Europe (Source: Eurostat)

2. Internet accesses in Portugal (Source: ICP)

3. Market penetration rate of Internet in Portugal (Source: ICP)

ver notas da Marta

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